Oil and gas (O&G) concern Dialog Group Bhd has signed a RM1.6 billion engineering, procurement, construction and commissioning (EPCC) contract with Petronas Carigali Sdn Bhd, an exploration unit of Petroliam Nasional Bhd (Petronas), for the Sabah-Sarawak gas pipeline project. Dialog had earlier received a letter of award from Petronas Carigali on March 6, as part of a consortium with Punj Lloyd Ltd and Petrosab Logistik Sdn Bhd.

Punj Lloyd is an Indian engineering company that engages in EPCC works in pipelines, tankages and terminals, while Petrosab is a wholly-owned Sabah state government agency involved in the provision of O&G services to oil majors and contractors. The project is expected to be completed by March 2011. The pipeline will run a total of 512km, consisting of 90km in Sabah from the Sabah O&G Terminal in Kimanis and 433km in Sarawak to the Petronas LNG (liquefied natural gas) Complex in Bintulu.

According to analyst reports, the contract is expected to contribute to Dialog's earnings for the first half of the financial year ended June 30, 2012. Dialog has stated that it will be funding the project using internal funds or bank borrowings. Meanwhile, Bloomberg reported that Seadrill Ltd, the Norwegian oil-rig company set up by billionaire John Fredriksen, had won a US$182 million (RM578.76 million), four-year contract from Petronas Carigali.

The report said the contract was for the self-erecting tender rig Teknik Berkat, the Bermuda-based company said yesterday in statement. Seadrill owns 49% of the rig. The agreement includes early termination and immediate release of Teknik Berkat from the current contract with CarigaliHess, according to the statement.

Source :The Edge Financial Daily