Enra eyes RM1b worth of upstream oil & gas jobs

KUALA LUMPUR: Enra Group Bhd, which aims to return to the black this year, is eyeing over RM1 billion worth of upstream jobs in the oil and gas sector, said its president and group CEO Datuk Mazlin Md Junid.

“We are now working with regional operators of marginal fields a lot, who don’t require big, heavy assets for installation. Australia has one of the largest number of marginal fields currently so we are looking at a few operators in Australia. We also have some operators in Malaysia, Thailand and Myanmar. These are the countries we are focusing on. They are looking at partnerships,” he told reporters at its AGM today, explaining its strategy in a low oil price environment.

Platforms for marginal fields may last 10 to 15 years compared with the big platforms built by bigger companies, which last 20 years or more.

“We have nearly half a dozen proposals that are out there already, in various stages of completion… we hope at least within the next 24 months, a couple of them will hit,” he added. Enra’s oil and gas orderbook is over RM200 million in upstream, which will last about four years and about RM50 million per year in downstream.

Mazlin said in a low oil price environment, Enra aims to be a partner and provide solutions to oil companies, rather than being just a contractor, and is able to do so due to its versatility and low cost base.

“Petronas (Petroliam Nasional Bhd) has to tender for compliance and governance reasons. Sometimes we find that a bit of a challenge because they invite many people. Our preference is, we try to work with small operators, other oil companies that don’t require tenders, privately owned ones. This is how we try to get more work,” he said.

On the novel licence recently awarded by Petronas to Enra Icon Sdn Bhd, Mazlin said the licence is renewable every two years and allows the joint venture (JV) company to provide services to Petronas. Enra Icon is a JV between Enra and Australia’s Icon Engineering Pty Ltd.

“Our partners, Icon, have got novel ways of designing, building and installing platforms. This licence is a novel licence. Petronas has certain category of licence awarded depending on your track record and the exclusivity of your design. There are not many who have the novel licence. In Petronas for this particular grouping, there’s only about three or four. Whenever there is a need for that kind of work, they will definitely call us,” he said.

In the property division, executive director Kok Kong Chin said it has looked at more than a dozen potential land and projects, and is actively pursuing two to three of them.

“Our strategy is not to go into big townships like the big boys. We are looking at smaller, five to 20 acre land which we can launch quickly and at the price range of RM500,000,” he said. The group, which is eyeing JVs with landowners, also has the rights to reclaim up to 200 acres of land in Labuan. It will also be completing Portland Chambers in London in FY18.

On its transition exercise, executive deputy chairman Tan Sri Kamaluddin Abdullah said it expects to conclude the disposal of the last of its “legacy assets” by end of 2017, after which it expects to return to the black.

“Last financial year’s losses were due to impairments. From operating standpoint, we made profit. We are still going through the transition. By the time we complete the last asset disposal, towards end 2017, it would already be three quarters for this FY18,” he said, adding that most of the growth will likely happen in FY19.

In FY17, Enra achieved RM179.3 million revenue, of which 33% came from oil and gas and the remaining 67% from property development.