Business

Wednesday October 21, 2009

More financial support needed for O&G players


By Edy Sarif

edy@thestar.com.my

LUMUT: Kencana Petroleum Bhd hopes to see banks giving more financial support to local oil and gas (O&G) players so that they can become more competitive in the international market.

Group chief executive officer Datuk Mokhzani Mahathir said the oil and gas business remains robust industry despite the economic slowdown and that for local players to venture overseas, they would need financial support from banks.

Kencana Petroleum Bhd chief executive officer Datuk Mokhzani Tun Mahathir taking a tour around the barge, KM-1, fabricated by Kencana HL Sdn Bhd at its fabrication yard in Lumut yesterday

“The O&G industry especially the global market is very huge with lots of business opportunities waiting. However, if we don’t have strong financial position how are we going to compete with other international players?” he said yesterday at a press conference here in conjunction with the company being awarded global certifications.

Kencana was recently awarded with ISO 14001:2004 Environment Management System and BS OHSAS 18001: 2007 Occupational Heath & Safety Management System by AFAQ AFNOR, a global provider of worldwide certifications from France.

Mokhzani said Kencana would continue to focus on the O&G business and had no immediate plans yet to venture into other energy busineses, such as solar.

“The fossil fuel’s rate in the market is still competitive as compared to other source of energy. This however, doesn’t mean that we will not venture to other source of energy business but this will be in much later time,” he said.

Kencana would focus on core activiities such as fabrication of offshore and onshore oil and gas production facilities, installation, hook-up and commissioning, shipbuilding, repair and conversion, Mokhzani said.

“Our future market focus will be in the Middle East, India and also Australia apart from the local market. Our current split of ratio for business revenue is 80:20 where 80% derives from local market,” he said, adding that next year, the ratio might increase to 50:50 if the company managed to secure overseas contracts.

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