Highlight Petronas 1Q profit after tax falls 8% y-o-y; in talks to sell 10% stake in Canadian LNG biz

by **Cals** Thu 15 May 2014, 00:49

Highlight Petronas 1Q profit after tax falls 8% y-o-y; in talks to sell 10% stake in Canadian LNG biz

Business & Markets 2014

Written by Jeffrey Tan of theedgemalaysia.com

Wednesday, 14 May 2014 19:26

KUALA LUMPUR (May 14): Petroliam Nasional Bhd (Petronas)’s profit after tax (PAT) fell 8% year-on-year (y-o-y) to RM18.8 billion from RM20.4 billion in similar quarter a year ago.

Revenue, however, jumped 10% y-o-y to RM84.0 billion from RM76.7 billion.

"Our PAT decline (year-on-year) was due to a drop in oil price and impairment losses," said Tan Sri Shamsul Azhar Abbas, president and group CEO of Petronas.

"Nevertheless, a plus point is that our production went up," he added at a press conference.

Shamsul deems 1Q 'has been good so far'.

He said Petronas has contributed dividends totalling RM7 billion to the Federal Government in the first quarter of this year.

In response to questions, he said Petronas is negotiating with three to four companies for a potential partner to hold a 10% stake in its Canadian liquefied natural gas (LNG) business.

"We are in the process of negotiating with three to four companies for an additional 10% stake," said Shamsul.

"If the price is right and it is a good deal, we will do it. Otherwise, we are in no hurry to close the deal," he said.

At the Petronas 1Q financial results briefing, Shamsul noted the state oil firm currently has a 62% stake in the Canadian LNG project, which is led by its two subsidiaries Progress Energy and Pacific Northwest LNG.

He said Petronas has already three 'excellent' partners for the project, namely Indian Oil Corporation, Japan's JAPEX Montrey Ltd and Petroleum BRUNEI.

Meanwhile, Petronas Executive Vice President and group CFO Datuk George Ratilal said Petronas would not be raising funds from the bond market this year, but would likely do so in the next few years.

"Looking at our balance sheet today, we are fairly comfortable with our level of cash," he said.

"Going to the bond market depends on our spending pattern, which will more likely happen in the next few years," he said.