Falling crude oil prices to have little impact on Dialog

KUALA LUMPUR: Dialog Group Bhd expects little impact from falling crude oil prices, said its executive chairman Tan Sri Ngau Boon Keat.
"For us, the business model is very consistent. As you know, one-third of our business is in upstream, one-third in midstream and the other one-third in downstream. So the price of oil coming down may affect the upstream business a bit, the budget may be slightly affected but certainly the midstream and downstream will be okay.
"When the price of oil goes down, normally transfer pricing to the downstream is lower so downstream will make more money, they will have more budget to spend for maintenance or expansion," he told reporters after its AGM yesterday.
Ngau said the group is able to transfer its manpower to the downstream business when there is less activity in the upstream business, and vice versa.
On the Pengerang Terminal, the group expects to commence construction of Phase 2 by mid-2015 and aims to be operational by end of 2017.
"Phase 2 comprises LNG (storage terminals) and tankage for RAPID (Petronas' Refinery & Petrochemical Integrated Development). Even though part of the tankage will come to the port, it is still not finalised yet," said Ngau.
He said Phase 1, including Phase 1C, will be completed by December.
"Once completed and rented out, it will start contributing. Normally in the first year or so of operations you don't expect much contribution," Ngau added.