Exciting play for Kencana ... and Scomi
Both Scomi and Kencana will be bidding against each other for the various oil-and-gas projects from Petronas.Scomi is associated to the son of the current PM and Kencana is son of the ex-PM.
It will surely be an exciting play by both.
Abstract from The StarOil and gas company of both Prime Minister's children bids for more than RM3bil worth of projects from Petronas
it's busy time for the oil and gas industry with the many development activities taking place.
It is also widely known that there will be more field development activities in existing and new fields, with deepwater and marginal fields creating opportunities for growth.
The level of investment in the exploration and production of oil and gas industry in Malaysia has increased by an average annual rate of 17.9% between March 31, 2000 to March 31, 2006.
For investors wanting to ride the commodity cum oil and gas wave, another chance has offered itself in the form of main board bound Kencana Petroleum Bhd.
It has all the ingredients of an exciting play, and is perhaps, a little similar to oil and gas darling, Scomi. In 2003, when Scomi made its debut on Bursa Malaysia, it attracted significant interest, largely due to the fact that its controlling shareholder Kamaluddin Abdullah is the son of Prime Minister Datuk Seri Abdullah Ahmad Badawi.In the case of Kencana, the executive chairman and largest shareholder is Datuk Mokhzani Mahathir, son of former Prime Minister Tun Dr Mahathir Mohamad. Following the listing exercise, Mokhzani will have a 53.54% interest in Kencana via wholly-owned Khasera Baru Sdn Bhd.
Presently, Kencana is bidding for RM3bil worth of jobs. Track record wise, the company has completed jobs in India, New Zealand, Thailand and Australia.
It expects to win up to 30 per cent of these bids, group deputy executive chairman Chong Hin Loon said earlier this month.
Earlier this year, Kencana clinched its biggest contract worth RM790mil from the Thailand-Malaysia Joint Development Authority to build an offshore oilrig facility some 150km from Kota Baru.
Kencana is one of seven companies (including Scomi) licensed by state oil firm Petroliam Nasional Bhd to build offshore production platforms. It has a 21ha fabrication yard in Lumut, Perak.
Will it be a healthy competition between the two prime ministers' children?Will they form strategic alliances?
Will Petronas face problem with the two organization bidding for the same project? Or will Petronas try to give both equal projects on a "win-win basis"? Is there such thing as a win-win?
If there is win-win for both Kencana-Scomi, then who will be the loser? Petronas? Or, will it be Petronas-Kencana-Scomi Win-Win-Win, and the rakyat the loser?
The latest news is that Tycoon Quek Leng Chan of Hong Leong Bank had bought 12% to 15% of Kencana's shares from existing shareholders.Quek recently sold his shares in OYL Industries Bhd to Japan's Daikin Industries Ltd for RM7.61 billion.
1 comment:
Although both Scomi and Kencana are in the same industry (upstream industry of oil and gas), but they are not competitors as both of their business differs from each other.
Scomi are into waste management, and supplying drilling fluid, and they target drilling company and oil company.
As for Kencana, they are into designing and fabrication of offshore rigs, structures, modules, process equipments and etc.
In Malaysia, there are altogether 7 fabricator licensed by Petronas and they are Sime Engineering, Malaysia Marine and Heavy Engineering (MMHE), Oil Fab, Penang Shipyward, Brookes Dockyard, Ramunia, and lastly HL engineering (which was taken over by Kencana Petroleum some year back).
Therefore, they are not competitors as what you have mentioned above.
However, due to their nature of business in oil and gas, they are definitely in Petronas's list of preferred companies.
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