Petrofac JV Wins $2 Bln Refinery Contract in Oman

Petrofac Ltd said Oman's Duqm Refinery and Petrochemical Industries awarded a $2 billion contract to the British oilfield services company's 50:50 joint venture with Samsung Engineering, sending its shares up as much as 9.5 percent.

 

The 47-month project includes engineering, procurement, construction, training and start-up operations for all utilities at Duqm, the Middle East-focused company said on Friday. The company's high exposure to oil markets in the Middle East has resulted in good backlog coverage for 2017, as record production in the region drove up contract awards.

 

High level of tendering activity is evidence of greater confidence in our core markets and we continue to have a very good pipeline of bidding opportunities," CEO Ayman Asfari had said in a statement in June.

 

The order book size of the company, which builds and operates oil and gas facilities, was $13 billion as of May 31.

 

It recorded an order book value of $14.3 billion in 2016, as orders picked up in its core Middle Eastern markets.

 

Petrofac's core profit would be weighted towards the second half of the year, Asfari had said.

 

The Duqm refinery in Oman is being developed over 2,000 acres and is expected to have a capacity of 230,000 barrels of oil per day when completed, Petrofac (POFCF) said.

 

In June, the company secured an agreement with Oman's leading oil exploration company, Petroleum Development Oman, to provide engineering and construction management services for its oil and gas projects.

 

Petrofac is under investigation by the UK's Serious Fraud Office (SFO) for its dealings with Monaco-based Unaoil, which Petrofac said it had engaged primarily in Kazakhstan to provide local consultancy services between 2002 and 2009.

 

At 1124 GMT, Petrofac shares were trading up 7.5 percent at 477.6 pence.

 

The company has underperformed its peers and the broader STOXX Oil and Gas index this year, Thomson Reuters data showed.


(Reporting by Sanjeeban Sarkar; Editing by Arun Koyyur)