PETALING JAYA: Sapura Energy Bhd expects oil prices to remain volatile in the medium term, driven by fundamental supply and demand dynamics.
The oilfield services company said in a statement that a rebalancing of these factors is expected to trigger the return of investment appetite for offshore development projects.
The company added that activity levels would remain subdued in the short term, while competition should remain intense.
“Leveraging the diversity of skills and talent that we possess, we believe Sapura Energy is well positioned to address a wider scope of the energy value chain globally.
“We will continue to pursue our strategies on global market expansion and cost optimisation, and setting the scene right as the industry finds its way back to recovery,” it said.
Sapura Energy said it had reported a net profit of RM206mil in the financial year ended Jan 31, 2017.
“The group’s coordinated effort towards market expansion and cost reduction has resulted in RM7.7bil in revenue and profit before tax margins before an impairment of 8.7%.”
It pointed out that the industry environment remained challenging, with increased competition in the services segment due to the widespread cuts in capital expenditure.
“The group has been competitive in securing new work worth RM6.3bil for 2017. Notable wins for the group include the Trans Anatolian Gas Pipeline in Turkey, the EPCIC of the B-127 Project in India, the KMZ sour gas pipeline in Mexico, the long-term Plug and Abandonment contract in Brunei, and decommissioning work in Malaysia, Brunei and Australia.”
In the exploration and production segment, Sapura Energy said it had made significant progress in commercialising its gas fields.
“The B15 SK310 development is on track for first gas by the third quarter of this year.
“The additional gas discoveries for SK408 offshore Sarawak enhances our position as an Asian-based independent and we continue to leverage our in-house expertise to identify new opportunities to add further to the group’s portfolio of resources and reserves.”