Publication source: The Star
Date: 6 November 2015
Malaysia’s Handal Resources and New York listed Nabors sign MoU
KUALA LUMPUR: Integrated offshore crane services provider and fabricator Handal Resources Bhd has signed a memorandum of understanding (MoU) with New York-listed Nabors Industries Ltd to explore opportunities in rig services for the local oil and gas (O&G) industry.
Handal group managing director and chief executive officer Mallek Rizal Mohsin said the MoU was a technical collaboration between the two parties leveraging on their skills.
“With Nabors’ expertise, we hope to secure new businesses comprising workover projects, fabrication of offshore pedestal cranes and related overhaul and maintenance services, among others,” he said after the signing ceremony.
Meanwhile, Mallek prefers to be conservative on the company’s outlook due to the volatile economic landscape. This comes as Petroliam Nasional Bhd cuts down on capital expenditure (capex) this year amid a challenging outlook for crude oil prices.
Mallek said the capex cuts would impact Handal Resources’ net profit and orderbook, which stands at RM290mil and can last it till 2018.
“With the capex cuts, it will be tough. We are mitigated by the effects because of our long-term service contracts, but procurements with significant capex will slow down further, which is why we are looking at replenishing a few projects in the upstream activities,” he said.
Mallek said the company was looking at operational and cost efficiencies but not retrenchment, as most O&G firms had tightened their belts.
“Local industries should look into consolidating and complementing each other’s strength because there are too many involved in duplication of services. This does not lead to optimal work efficiency in the long term,” he said.
On mergers and acquisitions, he said the company was in talks with several parties in the upstream activities.
Nabors senior vice-president Subodh Saxena said the MoU was a building block for both firms to grow, leverage and complement each other’s businesses.
“By combining the resources and with Handal’s expertise, we can capture some market share,” he said.