KUALA LUMPUR (June 8): Cash-strapped Sapura Energy Bhd said it has secured 10 contracts across the Asia Pacific and Atlantic regions since last December, with a combined value of RM1.4 billion.

The oil and gas (O&G) services provider said the contracts were awarded to its engineering and construction (E&C), drilling, and operations and maintenance business segments, through the group's wholly-owned subsidiaries.

The contracts were awarded between December 2022 and May 2023, with more than 70% of the combined contract value coming from projects outside of Malaysia.

“These wins are testament to Sapura Energy’s resilience and are part of a shift in its strategy to focus on contracts and regions where the group is highly competitive,” the group said in a statement on Thursday (June 8).

Sapura Energy group chief executive officer Datuk Mohd Anuar Taib said the group is deploying some of its assets to new regions, enabling the group to secure new clients and overcome limitations brought on by financial constraints.

“We are also grateful for the trusted partnerships we have established with new and existing clients, who have continued to seek our solutions to deliver their projects,” he said.

Mohd Anuar said the shift in strategy bore early results for the financial year ended Jan 31, 2023 (FY2023), as the group recorded an operating profit of RM751 million, against an operating loss of RM2.2 billion in FY2022, despite the limited working capital and macroeconomic challenges.

“Building on the positive momentum achieved last year, the company is determined to extend the turnaround and continue exploring opportunities in the eastern and western hemispheres in which the group could maximise its assets and capabilities,” he added.

For the E&C segment, Sapura Energy's subsidiaries Sapura Offshore Sdn Bhd and Sapura Energy DMCC have been awarded a contract by ENI Congo for the provision of offshore transportation and installation services in Congo, which is scheduled for completion in 4QFY2023.

Another subsidiary, Sapura Energy (Thailand) Ltd, won two contracts in Thailand for offshore wellhead platform as well as pipeline installation and removal activities from Chevron Thailand Exploration and Production Ltd. Both contracts are expected to be completed by the end of this year.

In Australia, Normand Sapura Pty Ltd bagged a contract from Woodside Energy Ltd, an operator of Western Australia’s North West Shelf project, for the intervention and removal of a plug within the wellbore of the Tidepole TPA03 subsea well. It is expected to be completed by the 3QFY2023, pending all requisite approvals.

Sapura Project Pty Ltd has secured a contract in New Zealand from the government for the Tui Field Decommissioning Programme. The project is scheduled to take place over two weeks in the period of December 2023 to March 2024.

Meanwhile, Sapura Drilling Asia Sdn Bhd has received multiple contracts for the provision of semi-submersible tender-assist drilling rig services in Malaysia, awarded by Vestigo Petroleum Sdn Bhd, Larut Complex Late Life Redevelopment Project, Sarawak Shell Berhad and Sabah Shell Petroleum Co Ltd.

Sapura Drilling was also awarded several other contracts of semi-submersible tender-assist drilling rig services for rigs Sapura Esperanza, Sapura Pelaut, and Sapura Alliance, which are expected to be completed by 4QFY2023.

In the O&M segment, Sapura Technology Solutions Sdn Bhd secured a contract from Petronas Carigali Sdn Bhd (PCSB) for additional Field Service Engineer services on a turnaround call-out basis, comprising commissioning and start-up of the KINEW Compressor Upgrading Project at PCSB-SBA Erb West Platform. The project is scheduled for completion in 4QFY2023 with an estimated duration of four months.

Sapura Nautilus Sdn Bhd, another subsidiary under the O&M business segment, was granted a contract from SapuraOMV Upstream (Sarawak) Inc to provide one dynamic positioning accommodation workboat vessel for E11R-B Host Tie-In Modification Works for 2023. The contract is set to commence in the second quarter of the calendar year 2023.

The same subsidiary has also been awarded a contract from PCSB for the provision of anchor handling and tug supply services. The contract is expected to be completed in 4QFY2023.

"In addition to the contract wins, the group’s E&C team is in the midst of negotiations with its clients to rescope certain ongoing contracts, following the changes made by its clients during project execution," said Sapura Energy.

They comprise an engineering, procurement, construction and installation (EPCI) contract for Salman, announced on Sept 27, 2019, the offshore process platform project for the development of Kg Dwn 98/2 Nelp Block, announced on Dec 6, 2018, the EPCI for the wellhead platform in the Dorado project, announced on Sept 30, 2021, and the EPCI for the SBM Pipeline Rejuvenation Phase II project, announced on June 3, 2020.

Sapura Energy's share price closed half a sen or 12.5% lower at 3.5 sen on Thursday, giving the group a market capitalisation of RM559.27 million.