Yinson sees 2Q numbers drop. Optimistic about new FPSO deals

Malaysian FPSO supplier Yinson saw its revenue and profit decline in the second quarter of 2019, but it is optimistic about near-term FPSO contract opportunities.

The company’s revenue for the quarter was 213 million Malaysian Ringgit, down from 246,5 million Malaysian Ringgit, a drop of around 13 percent.

Profit for the period fell more than 30 percent, coming in at 54,9 million Malaysian Ringgit, down from 80,3 million Malaysian Ringgit year ago.

Looking ahead, the FPSO specialist said that the long-term outlook in the oil and gas industry remains challenging with the emergence of new alternative energy resources and financial institutions risk appetite towards the sector, coupled with the overall global economic exposure to rising trade protectionism, geopolitical uncertainty, and trade disputes.”

Yinson has recently felt the sting of a geopolitical issue when its joint venture company in Vietnam earlier this month lost a $1 billion for the supply of an FPSO for Repsol’s Ca Rong Do offshore field, due to “prolonged force majeure.” It has been widely reported that the force majeure event came into force when PetroVietnam ordered Repsol to suspend its Ca Rong Do work, to avoid confrontation with China due to the maritime border issue in the South China Sea.

Despite the negative factors that are affecting or may affect the industry, Yinson said its management was optimistic that the oil and gas industry would replenish its production capacity with new FPSO awards in the current financial year to counter the lack of investments over the past years.

According to a recent study by Rystad Energy, the global market for floating production, storage and offloading vessels (FPSOs) is headed for a major renaissance with as many as 24 FPSO awards expected by 2020, driven to a great degree by Brazil.

“Amid the challenging global economic environment and the volatility of other currencies against the US Dollar, the Group shall strive to achieve satisfactory results for the financial year ending 31 January 2020,” Yinson said.

Offshore Energy Today Staff

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