Tan Sri Shahril Shamsuddin - President and group chief executive of SapuraKencana Petroleum Bhd By Tee Lin Say

by **Cals** Sun 29 Dec 2013, 23:51

Published: Saturday December 28, 2013 MYT 12:00:00 AM
Updated: Saturday December 28, 2013 MYT 11:03:00 AM
Tan Sri Shahril Shamsuddin - President and group chief executive of SapuraKencana Petroleum Bhd
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SHAHRIL will be closely watched in 2014 for the execution of SapuraKencana Petroleum Bhd’s latest acquisition in Newfield Exploration Co and how he delivers on the company’s sizeable orderbook of RM28bil.
The market would also watch the restructuring of SapuraKencana’s debt.
Shahril has already said that he is looking to fill up unfilled capacity in SapuraKencana, bid for more jobs and address the Latin American market.
SapuraKencana is exploring several alternatives to restructure its debt into longer-dated debt, while still maintaining the stock’s syariah status.
It now has long-term and short-term borrowings totalling RM10.8bil, which includes the loan from its merger with Kencana Petroleum Bhd and the bridging facility for the acquisition of the tender rigs business.
On Newfield, SapuraKencana won the bid to acquire Newfield’s oil and gas (O&G) production blocks in Peninsular Malaysia, Sabah and Sarawak for US$898mil (RM2.8bil) back in October. This turned SapuraKencana into the country’s largest oil producer with a 4% market share. Development capital expenditure estimated for the SK310 and SK402 block in Newfield is US$2.7bil and US$217mil respectively.
Another issue is how SapuraKencana will ringfence the exploration and development assets from its service support business and how it would raise the project financing required for the development of the Newfield asset.
With Newfield, SapuraKencana stands among the few players that are both field owners and service providers. So far, only Petrofac and The Maersk Group fall into this category. Separately, SapuraKencana together with its existing risk-sharing contract (RSC) partner Petrofac is looking to tender for Petronas’ blocks PM-6 and PM-9 as well as two more marginal fields.
Just before the year closed, SapuraKencana scored another coup by being one of the recipients of Petronas’ Pan Malaysia offshore transportation and installation contracts worth some RM10bil.
Analysts have estimated SapuraKencana’s portion to be worth some RM6bil to RM7bil, thus also bringing up its orderbook to the RM30bil mark.
The group’s wholly-owned TL Offshore Sdn Bhd has secured packages C & D from 11 of Petronas’ Production Sharing Contractors to provide integrated transportation and installation services for offshore O&G facilities in 2014 to 2016 with a one-year extension option.
Commencement of these works is expected to be in March 2014 at various offshore locations in Malaysian waters.
Shahril has taken over the reins from his father Tan Sri Shamsuddin Abdul Kadir, the founder of Sapura Holdings, since the early 90s. Since then, Sapura has dabbled in information technology, security systems and O&G.
He found his playbook in the O&G sector, and today SapuraKencana has an orderbook of approximately RM30bil spread out in the regions of Brazil, Malaysia, South-East Asia and Australia. – By Tee Lin Say