KUALA LUMPUR: PERISAI PETROLEUM TEKNOLOGI [] Bhd is in talks with parties in Australia, Indonesia and India to secure the first contract for its award-winning mobile offshore production and storage unit (Mopsu).
Perisai group chief financial officer Yeo Pek Chin said it looked forward to securing its first contract, which would keep it busy for “a few” years. He was not able to share any earnings or revenue projection from these contracts.
“Mopsu is in line with Perisai’s strategy to grow in niche areas,” he told The Edge Financial Daily in a recent interview.
He said the Mopsu TECHNOLOGY [], known for its cost efficiency and mobility versus typical drilling platforms, was suitable for shallow water and marginal fields. Perisai was recently awarded the “Excellence in Innovation” award by Frost&Sullivan for using Mopsu.
Yeo said the Mopsu, with a life span of about 25 years, had the capability to operate water depths of 80 to 120 metres, depending on its variant or type. It costs about US$70 million (RM235.9 million) to US$80 million to fabricate a Mopsu.
To fund the deployment of the first Mopsu, Perisai recently raised funds via a US$10 million redeemable convertible bonds (RCB), which were fully taken up by a private equity fund in Singapore.
Noteworthy is that the RCBs are the first US dollar-denominated bonds issued and cleared in Malaysia, paving way for more of these issuances to come.
Yeo said Perisai opted for the RCB given its effort to diversify its investor base. Furthermore, he said, as its revenue from the Mopsu business would be quoted largely in the greenback, the RCB also provided a natural hedge against foreign exchange movement.
Also, Perisai, as an issuer, would not have the obligation to make periodic interest payments that may disrupt cash flow, he added.
Perisai has tied up with Gryphon Energy (Asia Pacific) Sdn Bhd, the exclusive licensee of Mopsu, to establish a new company to market Mopsu in the Asia-Pacific region and will have the option to take up to 90% stake in each of the Mopsu units as well as the right of refusal on value-added services.
Perisai will hold a 49% stake in the new company and the rest by Gryphon. Mopsu’s intellectual property is owned by Kingtime International Ltd.
Yeo expects the demand for Mopsu to be “encouraging” due to its nature of cost efficiency, early production system, scalability and flexibility. It is understood that the Mopsu can help oil giants save up to US$100 million on a typical field development.
As it takes 18 months to fabricate a Mopsu, it is safe to assume that Perisai may only see earnings in the venture to trickle in from next year onwards. Nonetheless, Perisai has projected a full-year net profit of RM61.1 million for the year ending Dec 31, 2009 (FY09) and RM74 million for FY10.
The company’s earnings would come from its vessels and corrosive control services.
The group’s net profit rose nearly ninefold to RM33.15 million in its first half ended June 30, 2009 from RM3.74 million a year earlier, while revenue rose 143% to RM66.96 million from RM27.64 million. Basic earnings per share rose to 9.02 sen from 1.80 sen.
Perisai attributed the increase in revenue and net profit to the execution of the existing bareboat charter contract for the Derrick Lay Barge and the lease of a portable saturation diving system.
In notes accompanying second-quarter results, Perisai said the group’s successful track record and its proprietary technology put it in the forefront for securing potential new contracts in the region as oil companies ventured into marginal fields, deepwater and remote environments.
It said the international patent-pending Mopsu was a breakthrough, a “game changer” in the oil and gas sector.
Perisai said unlike other systems, which relied on drilling rigs, wellhead platforms, pipelines or a floating storage and offloading vessel, Mopsu used modular drilling units, integrated storage and a detachable drilling template, with almost the entire system fully recoverable and reusable.
The company had said an immediate contract award was contemplated to a reputable shipyard once an end-user contract had been signed or financing secured to build the first unit. Perisai shares ended one sen higher at 59.5 sen last Friday.
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