Yinson hopes to seal Nigerian FPSO deal in Q3

KUALA LUMPUR: Yinson Holdings Bhd, which is in exclusive talks to supply a floating production storage and offloading (FPSO) unit to Nigeria’s First Exploration & Petroleum Development Co Ltd (First E&P), expects to conclude the negotiations in September this year.

Previously, the FPSO specialist said it expects to seal the deal by June 30.

“We intend to close the deal as soon as possible, but it is a very long-term contract and there is another party across the table that we need to negotiate with,” its group CEO Lim Chern Yuan told reporters after its AGM today.

“We don’t know whether it is a realistic target but we will try our best to come to a conclusion within the next quarter, by September,” he added.

Last month, Yinson announced that it had entered into an exclusive negotiation with First E&P to discuss the supply of an FPSO unit along with operations and maintenance works for the Anyala & Madu field located 40km offshore of Nigeria.

Tentatively, the contract is to have a firm period of seven years with an option to renew for up to eight years.

On its outlook on the industry, Lim said the group remained optimistic on the demand for FPSOs in the next two years as it sees increasing bidding activities globally.

“We believe there was an under-investment in the oil and gas business in the past few years, and it is catching up now. We also see a lot of projects being awarded in a shorter period of time.

“Over the last one to two years, we have built up our balance sheet and human resources. That, coupled with the current level of oil prices, we believe that we are in a very good position to take on projects,” he added.

Lim said the group has secured one project this year-to-date. Its order book currently stands at US$4.3 billion (RM17.3 billion) and will keep it busy until 2037.

He added that Yinson will continue to bid for jobs in its core geographical areas, namely Asia and Africa, noting that the group had also started to bid for projects in new areas such as the US region. However, he declined to disclose the value of its tender book.

Yinson is the sixth largest FPSO company in the global FPSO market having a geographical presence in Malaysia, Vietnam, Singapore, Norway, the US and Africa.

Its shares closed unchanged at RM4.52 yesterday with 598,000 shares changing hands.