Sindora to benefit from multi-billion ringgit O&G hub in Johor

22 June 2010 , By The Star

Sindora Bhd sees it will benefit from the upcoming multi-billion ringgit oil and gas (O&G) hub in the Teluk Ramunia and Pengerang areas in southeast of Johor.

Chairman Tan Sri Muhammad Ali Hashim said the company’s Intrapreneur Venture Business (IVB) 51%-subsidiary E.A. Technique (M) Sdn Bhd that owns and manages vessels for the O&G sector would be the main beneficiary.

He said the setting up of E.A. Technique’s shipyard in Tanjung Langsat Port in Pasir Gudang, Johor, offering shipbuilding and ship repairs works would complement activities at the O&G hub.

As of to date, the O&G hub has received RM16bil and RM30bil investments from Qatar and Iran companies and also RM2bil for a shipyard project from an Asia-Pacific-based company and RM500mil for a fabrication yard from a local company.

“Johor has insufficient facilities for ship building and ship repairs activities with most vessel owners either going to Singapore or Batam in Indonesia,’’ Ali said in a press conference after Sindora AGM on Monday.

Work on the phase one of the shipyard on the 0ha area at the cost of RM22mil already started with expected completion in mid-2011, the remaining 10ha site would developed depending on business requirement.

He said the shipyard was designed to accommodate the company’s requirement to service its vessels for repairs and building new tankers with excess capacity would be offered to other shipping companies.

Ali said with the shipyard in Tanjung Langsat Port, its shipbuilding activities undertakes by E.A. Technique’s wholly-owned subsidiary Johor Shipyard Engineering Sdn Bhd (JSE) in Teluk Intan, Perak would be moved to Johor.

“The shipyard will also offer mini fabrication works for floating structures used by petroleum companies for the O&G exploration activities,’’ he added.

Ali added many fabricators based in Singapore have approached the company and they have shown strong interest to offer the mini fabrication works to JSE.

He said the company was confident that the shipyard would be able to attract more shipbuilding and ship repairs contracts from Singapore due to the high cost of shipbuilding and ship repairs in the republic.

Ali said apart from Singapore, those having their ships done in shipyards in Batam now, would probably go to Johor due to the latter’s close proximity with Singapore.

Meanwhile, managing director Rozan Mohd Sa’at said Sindora would continue to develop small and medium enterprises (SMEs), to be part of its IVB scheme.

He said it had received many applications from SMEs and companies in Johor Corp which is Sindora’s parent company to join the scheme.

“We will consider their applications if their activities could add synergy to our business activities,’’ added Rozan. Presently, the nine firms involved in activities such as logistics, office solutions service provider, parking operator, shipping, forwarding and biotechnology.

For the financial year ended Dec 31, 2009, Sindora registered RM43.83mil net profit on RM336.48mil compared with RM21.16mil and RM351.193mil recorded respectively in FY2008.