Muhibbah Engineering expects offshore business to pick up

Marine services businesses are riding the crest of the South East Asian oilfield business with the Malaysian-based Muhibbah Engineering echoing last week's positive news from the Fremantle-based Mermaid Marine.
Muhibbah Engineering expects offshore business to pick up Muhibbah Engineering expects offshore business to pick up Muhibbah Engineering expects offshore business to pick up Muhibbah Engineering expects offshore business to pick up Muhibbah Engineering expects offshore business to pick up

Muhibbah shipbuilding division plans to post a 20% increase in profit on the back of demand for more anchor handling tug-cum-supply vessels, especially now with the increased activity in the oil and gas industry. The company is confident that Petronas Carigali will order more vessels of this type for its offshore oil and gas drilling activities.

The 60-metre anchor handling vessels are normally used to ferry mud and cement to complete oil and gas drilling activities. Muhibbah is currently negotiating to build eight such units for a total contract value of RM350 million, with RM200 million from overseas clients. Furthermore, such fiscal expectations are expected to be met as there are about 20 companies that form the market for this type of vessel.

Muhibbah has invested some RM100 million into its 32.37ha shipyard in Teluk Gong and provides civil, marine, and structural engineering contract work, which includes the construction of bridges, heavy concrete foundation, factory complexes and marine ports. Its shipyard can build ships weighing 10,000 tonnes each.

Mermaid has won a number of construction and support contracts in recent times with its share price also performing strongly.

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