joint venture


China sees ‘enormous potential’ in Saudi Arabia’s economy

BEIJING: China sees ‘enormous potential’ in Saudi Arabia’s economy and wants more high-tech cooperation, the Chinese government’s top diplomat said, as Saudi Crown Prince Mohammed bin Salman began a two-day trip to Beijing. The Saudi delegation, including top executives from Aramco, arrived on Thursday on an Asia tour that has already seen the kingdom pledge […]

Tune Protect’s profit rises on lower claims incurred

KUALA LUMPUR, Feb 22 — Tune Protect Group Bhd’s net profit rose 6.5 per cent to RM49.31 million in the financial year ended Dec 31, 2018 (FY18) largely due to a RM39.73 million drop in net claims incurred. The digital insurer achieved the…

Saudi agrees US$10b China refinery deal as crown prince visits

BEIJING, Feb 22 — State-owned oil company Saudi Aramco signed a US$10 billion deal to build a refining and petrochemical complex in China today, as Saudi Crown Prince Mohammed bin Salman wrapped up a two-day trip to Beijing. The Saudi delegation,…

MISC Q4 earnings jump nearly five-fold on lower impairment losses

PETALING JAYA: MISC Bhd posted a net profit increase of about five-fold for the fourth quarter ended Dec 31, 2018 (Q4) to RM338.7 million, from RM68.2 million in the same period in 2017.

This was due to lower impairment losses on ships, offshore floating asset and other investment, coupled with higher share of profit of joint ventures and gain on acquisition of businesses during the quarter under review.

Revenue for the quarter down slightly by 3.1% to RM2.39 billion, from RM2.47 billion in the same quarter a year ago.

For the full year, its net profit declined 33.8% to RM1.31 billion, from RM1.98 billion a year ago, while revenue decreased 12.8% to RM8.78 billion, against RM10.07 billion previously.

On its prospects, MISC said 2019 is projected to be still another challenging year for tanker markets as growth in seaborne oil demand is expected to be impacted by the recently announced Opec-led production cuts, while geopolitical uncertainty continues to cloud future energy demand.

Nevertheless, it said the LNG segment is expected to continue to benefit from the market strength seen in 2018 going into 2019, supported by demand growth in Asia, additional supply from new liquefaction projects and slower LNG fleet growth in 2019.

Higher fuel prices dent AirAsia X’s Q4 performance

PETALING JAYA: AirAsia X Bhd suffered a net loss of RM99.27 million in the fourth quarter ended Dec 31, 2018 compared with a net profit of RM84.42 million a year ago due to higher fuel prices.

In a filing with Bursa Malaysia, the airline reported an increase in average fuel price to US$89 per barrel during the quarter from US$69 per barrel a year ago, which resulted in a lower net operating profit of RM27.4 million from RM120 million a year ago.

In addition, the group provided an impairment on amount due from joint venture amounting to RM24 million during the quarter under review.

During the quarter, the group reported a 1% improvement in cost per available seat kilometre (CASK) to 12.27 sen while CASK ex-fuel improved by 16% from 8.22 sen to 6.94 sen a year ago, due to enhanced cost management.

Revenue for the quarter fell 5.93% to RM1.15 billion from RM1.22 billion a year ago.

For the financial year ended Dec 31, 2018 (FY18), the group also swung into the red registering a net loss of RM312.7 million compared with a net profit of RM98.89 million a year ago while revenue fell marginally to RM4.54 billion from RM4.56 million a year ago.

AirAsia X said its current forward booking trend and average fares for the first quarter of 2019 are within expectation and prospects are anticipated to remain encouraging.

The airline will be adding up to five aircraft through operating leases this year via AirAsia X Thailand while AirAsia X Malaysia will remain with 24 aircraft.

AirAsia X Malaysia will focus on maximising aircraft utilisation of its current fleet and leverage on the group’s strategy in new route launches as well as increasing frequencies of core routes.

The stock rose 1.75% to close at 29 sen today with 14.89 million shares traded.

Pharmaniaga’s Q4 profit down 79%

PETALING JAYA: Pharmaniaga Bhd’s net profit for the fourth quarter ended Dec 31, 2018 plunged 79.6% to RM4.44 million from RM21.7 million a year ago due to lower demand from government hospitals and higher finance costs.

In a filing with Bursa Malaysia, Pharmaniaga said its results in the corresponding quarter last year included a one-off compensation receivable in relation to a previous joint venture company in China.

The group said the lower profit was also due to recognition of prior years’ corporate tax.

Revenue for the quarter fell 2.7% to RM596.64 million from RM613.2 million.

Pharmaniaga declared a fourth interim dividend of 2 sen for FY18 to be paid on April 10, 2019.

For the financial year ended Dec 31, 2018 (FY18), its net profit fell 21.1% to RM42.47 million from RM53.82 million a year ago while revenue rose 2.6% to RM2.38 billion from RM2.32 billion.

Moving forward, the group expects the economic landscape to be challenging with moderate growth fueled by the government’s implementation of policies that are expected to boost private consumption and consumer spending.

The group said it will continue to focus on strengthening business synergies between its overseas subsidiaries, PT Millennium Pharmacon International TbK and PT Errita Pharma to tap into opportunities in the Indonesian market.

AirAsia X records net loss of RM312.69m in FY18

KUALA LUMPUR, Feb 21 — AirAsia X Bhd recorded a net loss of RM312.69 million in the financial year ended Dec 31, 2018, against a net profit of RM98.89 million chalked up in 2017. Revenue slipped to RM4.54 billion from RM4.56 billion previously,…

Sime Darby allocates RM1b capex for 2019

KUALA LUMPUR, Feb 21 — Sime Darby Bhd is allocating RM1 billion for capital expenditure (capex) this year. Group chief executive officer Datuk Jeffri Salim Davidson said the capex is mainly for the upgrade and refurbishment of its motor showroom….

Saudi Aramco to sign China refinery deals as crown prince visits, say sources

BEIJING, Feb 21 — Saudi Aramco plans to sign preliminary deals to invest in two oil refining and petrochemical complexes in China during the Saudi Arabian crown prince’s visit this week, sources familiar with the plans said, as Beijing seeks…

Shell, PetroChina spat holds up biggest Australian coal seam gas project

MELBOURNE/SINGAPORE: Royal Dutch Shell and PetroChina are at loggerheads over gas sales pricing at their Arrow Energy joint venture, holding up development of Australia’s biggest coal seam gas resource, three industry sources said.

PetroChina, the listed arm of China National Petroleum Corp (CNPC), is eager to start developing Arrow’s 140 billion cubic meters of gas in the Surat Basin in Queensland to turn around loss-making Arrow Energy, one of its key overseas assets.

It is at the mercy of venture partner Shell, however, as the Anglo-Dutch oil company is also majority owner of Arrow’s biggest potential customer, Queensland Curtis LNG (QCLNG), a liquefied natural gas plant on an island off Queensland state.

“PetroChina, as a 50% stakeholder in Arrow, expects to maximise interests from the JV versus QCLNG. But for Shell, it may be thinking of using its operator role at QCLNG to protect its interests,“ said a Chinese oil industry executive, who declined to be named due to the sensitivity of the issues.

PetroChina’s investment is “already bleeding and the firm wants to cut losses, hoping not to make further bad investment decisions,“ the executive said.

Shell and PetroChina acquired the Surat gas resource in a A$3.5 billion (US$2.5 billion) takeover of Arrow in 2010. They had expected to reach a final investment decision on the Surat project in 2018, with first production around 2020, after the Arrow venture signed a 27-year deal at end-2017 to supply gas from Surat to QCLNG.

PetroChina, though, is unhappy with the price in the sales agreement with QCLNG and the technical plan for developing the gas. This is now holding up final approvals, according to three industry sources familiar with the talks, who declined to be named due to the sensitivity of the matter.

Shell Australia Chairman Zoe Yujnovich said on Feb. 13 that it is working through Chinese approval processes right up to senior levels of Beijing’s powerful state planner, the National Development and Reform Commission.

Shell still hopes to secure approval in time to deliver first gas in 2021, Yujnovich said.

“But it is an area we’re going to have work really carefully on, particularly the Chinese approval processes, as we step through the next phase,“ she said.

When asked whether gas pricing was in contention, a Shell spokeswoman said that Shell supports both Arrow and QGC in developing the Surat gas project. QGC is the Shell subsidiary holding the company’s stake in QCLNG.

The project would help unlock the majority of Arrow’s reserves for both the domestic and export markets, the spokeswoman said.

PetroChina said in an email to Reuters that “talks on investment and cooperation in Australia’s Arrow (project) are still ongoing,“ without responding to a question about the pricing dispute.

Big losses on key investment

PetroChina’s takeover of Arrow with Shell in 2010 was its first investment in Australia’s coal seam gas sector, seen as a key acquisition at the time, but it has been a big loss-maker.

Over the five years through 2017, the latest year available, PetroChina has reported losses of 15.5 billion yuan (US$2.3 billion) on its share of Arrow’s earnings.

Arrow Energy said in December that it had suspended engineering design work on a group of proposed expansion wells to reallocate spending to another area of the project.

It deferred all questions about timing or investment to Shell and PetroChina.

QCLNG is one of three LNG export plants built in Queensland, all fed by coal seam gas. QCLNG and one of its rivals are struggling to operate at full capacity as coal seam gas wells have proven to be less productive than expected.

This has led to concerns that QCLNG may have to shut one of its two processing units by 2025 if more gas isn’t brought into production. — Reuters