Eversendai eyes O&G contracts in Kazakhstan

KUALA LUMPUR: Eversendai Corp Bhd, a structural steel and power plant contractor, is looking at Kazakhstan and other east African countries for upcoming contracts in the oil and gas (O&G) sector.

The company, which moved into the O&G sector last year in its bid to expand its income stream, is bidding for RM8 billion worth of contracts, including those involving engineering, procurement, fabrication and installation works for the O&G sector.   

“We have already quoted and see potential projects in Kazakhstan. We are also looking into eastern Africa as these are the countries that will have new oil pipes (installed),” executive chairman and managing director Tan Sri A K Nathan said after the company AGM yesterday.

Currently, Eversendai has an outstanding order book of RM1.5 billion. The company aims to secure about RM1 billion worth of contracts for the whole of this year, after securing RM500 million so far.

“Some contracts have already been concluded, but yet to be announced.  Some are at the final stage, which would be announced in the next two months,” Nathan said.

The group will not be spending much on capital expenditure (capex) this year or next.

“We’re trying not to spend so much, but we have to invest some money for the O&G sector,” Nathan said, adding that RM50 million has been allocated as capex for this year.

Eversendai also plans to increase its steel fabrication capacity, although this would not happen within the next two years.

“Our factories are fully loaded, although we could cope for now. We have a current capacity of 120,000 tonnes. The Tiruchirappalli plant in India, which will be coming into operations, will add another 20,000 to 30,000 tonnes,” Nathan said.

Eversendai is also on the lookout for local projects. “We foresee projects in the pipeline such as the MRT and Rapid projects.”

“We are also looking at converting the conventional system of construction of high-rise building to using composite structures. We have been promoting (this system) to quite a number of developers and contractors, and should be able to conclude some projects by the end of the year,” Nathan said.

The steel turnkey and power plant construction firm will also expand its marketing offices in Singapore and Australia.

“We could use our Malaysian factory to fabricate the structures and export to these regions. Hence, we would be able to enhance revenue,” Nathan added.

Eversendai posted a net profit of RM121.5 million for the 2012 financial year ended Dec 31, on a revenue of RM1.02 billion. The company has steel fabrication plants in Malaysia (24,000 tonnes), Dubai (18,000 tonnes), Sharjah, UAE (54,000 tonnes) and Doha, Qatar (24,000 tonnes).

Some of its projects include the Tanjung Bin and Manjung power plants in Malaysia, the Yas Mall in Abu Dhabi, the Capital Market Authority in Saudi Arabia and the Etihad Seafood floating restaurant in Abu Dhabi.

This article first appeared in The Edge Financial Daily, on June 20, 2013.


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