(Asia-Pacific) - Scomi Group Bhd, an oil & gas services provider listed on the Main Board of Bursa Malaysia, reports that its wholly owned subsidiary Kota Minerals & Chemicals Sdn Bhd has been awarded five contracts for the provision of drilling fluid materials, equipment and services in Malaysia.
Based on the number of wells indicated in the joint tender document which is subject to the actual drilling activities to be undertaken by its clients, Scomi estimates that the contracts will generate a revenue of approximately $400 million).
The contracts were awarded separately by Sarawak Shell Berhad/Sabah Shell Petroleum Co Ltd., Nippon Oil Exploration (Malaysia) Ltd., Petronas Carigali Sdn Bhd, and ExxonMobil E&P Malaysia Inc., to support all their drilling activities in East and West Malaysia including deep water drillings.
The contracts are for four years with options to extend for another two years.
"Our track record and competitiveness are the key factors contributing to our success today. We are a player in a very high risk oil and gas industry, thus there is no compromise to our services." says Ridzuan Ali, senior VP - Malaysia Operations for drilling fluids and drilling waste management.
The contracts are inclusive of the provision of drilling waste management, namely the solids control equipment and services.
Prior to the new contracts, Scomi had been providing drilling fluids services in East Malaysia for Sarawak Shell and in West Malaysia for Petronas Carigali and ExxonMobil, for three and two years, respectively.
"We have a good track record with proven technology. It is a long-term confidence that we are building with our customers, to achieve a win-win situation." adds Ridzuan.
Scomi is also participating in a similar tender by Murphy Oil Corp. for its drilling activities in Malaysia, where its current contract is expiring in March 2006.
Scomi has been servicing Murphy in Malaysia since 2003.
"We are confident of executing the contracts in the most efficient manner for our clients. We have a good customer base and our operations are well-supported by our technical team at the Global Research & Technology Center," says Ridzuan.
Drilling Fluids and Drilling Waste Management is Scomi's largest business unit today, which has activities at 60 locations in 34 countries.
As at 3Q 2005, the unit contributed approximately 72% to Scomi group's revenue.
Scomi's largest drilling fluids operation is in Malaysia, where it runs a full research and technology center with a complete technical team to support its worldwide operations in the areas of product development, testing and training.
With the new contracts coupled with the positive outlook of the global oil & gas industry, Scomi is positive about its growth potential.
Scomi is expecting growth in all its five core businesses of Drilling Fluids and Drilling Waste Management Solutions and related engineering services, Marine Vessel Transportation, Manufacturing Business, Products & Services, and Oilfield Production and Enhancement Chemicals.