MISC may win more LNG jobs
Up to Rm4.57bil in work up for grabs next year
PETALING JAYA: The gas asset market is likely to stay robust, with another Us$750mil to Us$1bil (Rm3.43bil to Rm4.57bil) worth of job opportunities up for grabs next year for MISC Bhd, according to RHB Research.
The research unit said in a report that currently, MISC had four liquefied natural gas or LNG vessels on spot charters, of which three are due for renewal in the first half of 2023.
RHB Research added that despite global upstream capital expenditure (capex) expected to stay high, MISC’S priority now was on the conversion of the Mero 3 floating production, storage and offloading (FPSO) project, even as it is eyeing some engineering, procurement, construction, installation and commissioning or Epcic-related jobs together with its partners without incurring excessive capex.
The Mero 3 project was 59%-completed as of the third quarter of 2022, with the delivery date slated for May 2024, with Us$1.1bil (Rm5.03bil) capex being recognised.
On the other hand, MISC’S termto-spot ratio within the petroleum division remained unchanged at 72:28 in the third quarter of 2022.
The Mero 3 FPSO project, announced in August 2020, is one of the biggest FPSOS and will be deployed to the Mero field in Brazil, which is owned by the Libra Consortium.
RHB Research noted that MISC’S balance sheet remains solid, with its net gearing firmly maintained at 0.29 times as at the third quarter of 2022.
The research unit has increased its financial year ending Dec 31, 2022 (FY22) to FY24 estimated earnings for MISC by 2% to 14% after increasing its projected contributions from its heavy engineering and petroleum divisions.
RHB Research maintained its “buy” call on MISC with its sum-ofthe-parts valuation-based target price increased to RM8.10 (from RM8.04).
TA Research pointed out that three-year time charter rates for LNG vessels have inched up steadily since the onset of the Russia-ukraine war. It maintained its “hold” call on MISC but raised its target price to RM7.40 (from RM7.10) based on 16.5 times estimated 2023 price-to-earnings.