HDBSVR: FBM KLCI remains in vulnerable position

KUALA LUMPUR (March 26): Hwang DBS Vickers Research said although Wall Street was up slightly last Friday with its key equity indices rising between 0.2% and 0.3% at the closing bell, it expects limited spillover effects on Bursa Malaysia on Monday.

“Technically speaking, the FBM KLCI remains in a vulnerable position. Facing profit-taking pressures at the moment, the benchmark index could slip below its immediate support level of 1,580 ahead,” it said.

HDBSVR said against the slow market backdrop, following news reports in a business weekly, there could share price actions in: (a) Wah Seong, which is believed to have clinched a pipe-coating contract in Turkmenistan; (b) Deleum, as it may partner Petronas Carigali to form a global patent for a product that could increase oil extraction rates significantly; and (c) D’nonce TECHNOLOGY [], given that one of its subsidiary is in advanced talks to supply halal food products to Kazakhstan.



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Deleum gains, plans bonus share issue

At 9.59am trading Deleum Bhd, an equipment and services provider for oil and gas companies, gained 5.4 per cent to RM2.33, heading for the highest close since June 2008. The company proposed a one-for-two bonus share issue, it said in a statement to the stock exchange. -- Bloomberg



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FBM KLCI rises 3 pts in morning trade, cautious sentiment across Asian markets

KUALA LUMPUR (March 16) : Malaysian stocks rose in morning trade against cautious sentiment across Asian bourses due to China’s economic growth concerns.

At 9.24am, the FBM KLCI was up 2.79 points to 1.582.17 with some 135 million shares worth RM74 million traded. There were 173 gainersversus 93 decliners while 167 stocks were unchanged.

Top gainers across Bursa Malaysia include DELEUM BHD [] which rose 13 sen to RM2.34 followed by AEON CREDIT SERVICE (M) BHD [] which also added 13 sen to RM8.86.

Decliners include MUDAJAYA GROUP BHD [] and PMETAL-LA which fell six sen each to RM3.09 and RM2.12 respectively.

Most active was Naim Indah Corp Bhd which added one sen to 62.5 sen with some 15 million shares done.

In a note on Friday, TA Securities Holdings Bhd said Malaysian stocks may continue to trade sideways ahead of the weekend, as Asian equities consolidate seen due to weaker sentiment on China's economic growth prospects.

Asian indices hit by less optimistic sentiments in China include Australia’s S&P/ASX 200 which declined 0.23% to 4,268.1 points, and Taiwan’s Taiex which fell 0.29% to 8,098.38 while South Korea’s Kospi was down 0.1% to 2041.68.

China’s outgoing premier Wen Jiabao said on Wednesday that measures to curb property speculation must be maintained to prevent a real estate bubble which will be detrimental to the country’s economy. On Thursday, the Commerce Ministry announced that China’s foreign direct investment fell 0.9% to US$7.7 billion in February from a year earlier.



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Regional markets extend gains at mid-day

KUALA LUMPUR (March 9): The FBM KLCI remained in positive territory at the mid-day break on Friday as key regional markets extended their gains on improved sentiment on the back of a successful attempt by Greece to close the bond swap offer.

Greece' success in closing the bond swap offer enabled it to reduce its huge debt pile and avert a chaotic default that would pitch the euro zone into a fresh crisis, according to Reuters.

At the mid-day break, the KLCI added 1.55 points to 1,579.91, lifted by gains at select blue chips. Gainers led losers by 340 to 286 while, 312 counters traded unchanged. Volume was 714.59 million shares valued at RM546.47 million.

The ringgit strengthened 0.20% To 3.0044 versus the US dollar; crude palm oil futures for the third month delivery gained RM45 per tonne to RM3,337, crude oil rose 32 cents per barrel to US$106.90 while gold added US$5.18 an ounce to US$1,704.95.

At the regional markets, Japan’s Nikkei 225 rose 2.22% to 9,985.94, Hong Kong’s Hang Seng Index added 1.06% to 21,121.50, the Shanghai Composite Index rose 0.40% to 2,429.95, Taiwan's Taiex was up 0.34% to 8,011.59, South Korea’s Kospi rose 0.49% to 2,010.59 and Singapore’s Straits Times Index was up 0.44% to 2,983.41.

At Bursa Malaysia, gainers included BAT that rose 38 sen to RM52.40, Bonia 18 sen to RM2.48, Deleum 16 sen to RM2.20, KLK 14 sen to RM23.40, Tradewinds PLANTATION []s 13 sen to RM4.44, Press Metal and MBM Resources 11 sen each to RM2.09 and RM4.61, while Mercury and Johore Tin added nine sen each to 1.25 and RM1.23.

Naim Indah Corp was the most actively traded counter with 67.9 million shares done. The stock gained on sen to 64 sen.

Other actives included Sumatec, China Stationery, SILK Holdings, KeyWest, and Perisai .

Decliners included Petronas Dagangan and PPB which lost 12 sen each to RM18.24 and RM16.78, KAF, BLD Plantations and Far East down 10 sen each to RM1.80,RM9.35 and RM7.30 respectively. KLCC Property and Hong Leong Bank down eight sen each to RM3.34 and RM12.30.



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Markets gain on successful Greek bond swap

KUALA LUMPUR (March 9): Asian equity markets rose on Friday on improved sentiment on the back of successful attempt by Greece to close the bond swap offer on Thursday.

The bond swap offer was to reduce its huge debt pile and averting a chaotic default that would pitch the euro zone into a fresh crisis, according to Reuters.

BIMB Securities Research in a note Friday said that news on Thursday that Greece had managed to garner almost 90% of its bondholders to swap for new securities filtered through the market thus the broad based gains.

Improved employment outlook in the US provided further positive vibes thus pushing the DJI Average 71 points higher to above the 12,900 mark, it said.

“With Eurozone’s outlook on a stabilisation path, major European bourses ended up mostly in positive territory. “Regionally, there were across the board buying momentum pushing almost all Asian markets up.

“The FBM KLCI made minor inroads with a modest 3.53 point gain to hang around the 1,580 level. We expect the index to see more upside judging by the net inflow of foreign funds into the market over the past two weeks amounting to almost RM1.3bn and may surpass the immediate resistance of 1,585,” it said.

On Bursa Malaysia, the FBM KLCI edged up 2.67 points to 1,581.03 ay 10am, lifted by gains at select blue chips.

Gainers led losers by 234 to 128, while 246 counters traded unchanged. Volume was 339.49 million shares valued at RM196.50 million.

At the regional markets, Japan’s Nikkei 225 rose 1.03% to 9,869.78, Hong Kong’s Hang Seng Index added 0.33% to 20,970.30, the Shanghai Composite Index added 0.43% to 2430.73, Taiwan’s Taiex gained 0.37% to 8,013.72, South Korea’s Kospi was up 0.40% to 2,008.72 and Singapore’s Straits Times Index added 0.07% to 2,972.44.

Among the gainers on Bursa Malaysia, BAT rose 38 sen to RM52.40, Deleum 17 sen, Petronas Gas 14 sen to RM16.92, KLK 12 sen to RM23.38, CIMB, Tenaga and Johore Tin nine sen each to 7.35, 6.35 and RM1.22 respectively, CAB 6.5 sen to 44 sen while Astral Asia and Padini added six sen each to RM1.29 and RM1.54.

Naim Indah Corp was the most actively traded counter with 36.1 million shares done. The stock gained one sen to 64 sen.

Other actives included Sumatec, CSL, SILK Holdings, Olympia, KeyWest and HWGB.

Decliners included Dutch Lady, Petronas Dagangan, Fat East, PPB, Lafarge Malayan Cement, Quality Concrete, Brahim's and Iretex.



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Excitement abounds, stay in oil and gas

Oil and gas sector
Maintain overweight: Petroliam Nasional Bhd’s (Petronas) domestic activities are picking up, from first production systems to rejuvenation jobs. Platforms, chemicals and floating solutions are the essentials for development. Jobs will likely be spread out favouring a large group of local service providers such as Bumi Armada Bhd, M3Nergy Bhd, MISC Bhd, Ramunia Holdings Bhd, Tanjung Offshore Bhd and Deleum Bhd. We remain “overweight” on the sector.

Our recent fact-finding “coffee talk” round with oil and gas service providers revealed that a series of field developments will be rolled out this year. We have identified five projects revolving around the rejuvenation/enhanced oil recovery (EOR), early production system (EPS) and marginal to shallow water field projects. They are: (i) Petronas Carigali’s Angsi (EOR project off Peninsular Malaysia); (ii) Shell’s St Joseph (EOR project offshore Sabah); (iii) Carigali’s Tanjung Baram EPS; (iv) Hess’ Belud (Sabah’s shallow water field project); and (v) Hess’ Kamelia field.

This is a fast-track project. Petronas has set a target to hit first oil production by June 2013. It requires a vessel-based sea-water reverse osmosis (SWRO) plant (chemical floating production, storage and offloading [FPSO]) with the capacity to desalinate 150,000bpd of seawater to increase oil recovery rates up to 20%. US-based Water Standard won the oilfield desalination project and will likely partner an FPSO operator for this job. Conversion is expected to take 16 months to complete.



This project is similar to the Angsi field but on a smaller scale (30,000bpd desalination injection capability), and will use chemical alkaline surfactant polymer (ASP). Shell recently issued an invitation-to-bid (ITB) for the engineering, procurement, construction and commissioning (EPCC) job. Unlike the Angsi field, the main asset (vessel) will be owned by Shell. The winner of the EPCC job will jointly undertake the front-end engineering design (FEED) studies, choose and convert the tanker and earn project management fees, similar to Bumi Armada’s Sepat project.

Hess’ Belud field plan, meanwhile, calls for an FPSO and wellhead platform for the oil and gas complex on Block SB302 with first oil or gas production by 2014. The Kamelia project too requires an FPSO. Separately, the Tanjung Baram EPS project, awarded to a foreign party, is running into complications and will likely miss the first oil production target (1,000 to 3,000bpd) set for July 2012. A re-tender could occur should the issue remain unresolved.

We think Bumi Armada is the likeliest partner for Water Standard for the Angsi project. This would involve a chemical FPSO. For St Joseph, we gather that five bidders were invited (M3Nergy, Bumi Armada, Deleum, BW Offshore Sdn Bhd and Tanjung). Bids will close in February with an announcement in three months. Elsewhere, our ground checks suggest that M3Nergy’s odds of securing an FPSO contract are high; we think it could be for the Belud project. Also, market talk suggests that the MISC-Ramunia partnership is a frontrunner for an FPSO for the Kamelia field. — Maybank IB Research, Jan 27


This article appeared in The Edge Financial Daily, January 30, 2012.



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Deleum signs joint commercialisation agreement

PETALING JAYA: Deleum Bhd’s wholly owned unit Delcom Chemicals Sdn Bhd (DCSB) has entered into a commercialisation agreement with Petronas Technology Venture Sdn Bhd (PTVSB) to jointly undertake commercialisation activities of the Solid Deposition Treatment Technology (SDTT).

Deleum said under the agreement, PTVSB, the technology commercialisation arm of Petronas, is authorised to license the intellectual property rights of this technology to DCSB. It is a result of a joint effort between Deleum and Petronas following a collaborative research and development work which was undertaken by DCSB and Petronas Research Sdn Bhd.

The technology has been able to reduce operation costs by increasing the sustainability of the well production and is also compatible with formation hydrocarbon and well completion system.


This article appeared in The Edge Financial Daily, November 10, 2011.

Deleum inks deal with Petronas Tech

Deleum Bhd, a Malaysian oil and gas services provider, said it signed a commercialization agreement with Petronas Technology Venture Sdn Bhd for so-called solid deposition treatment technology.

This is a thermo-chemical treatment for problems with organic deposits on wells, pipelines and processing equipment, Deleum said in an e-mailed statement today. -- Bloomberg