Hiap Seng partners with Kub Builders on Petronas Rapid bid

MOU signed to formalize joint participation.

Mainboard-listed specialist engineering group Hiap Seng Engineering Ltd (Hiap Seng) has announced via a release that it has entered into a Memorandum of Understanding (MOU) with industrialised building system contractor KUB Builders Sdn Bhd (KUBB) to jointly submit a proposal to pre-qualify to participate in the Petronas’ Refinery and Petrochemical Integrated Development (Rapid) Tank Farm Project at Pengerang, Johor in Malaysia.

Hiap Seng said that under the terms of the MOU, both parties will combine their resources and expertise to jointly explore, apply and propose to pre-qualify to bid for this project. The Petronas Rapid Tank Farm Project is part of the major project RAPID which includes the development of refinery; Naptha Steam Cracker; polymers and specialty petrochemical plants with a central utility; and off-site facilities including interface facilities.

Mr. Frankie Tan, Chairman and CEO of Hiap Seng, said: “This prestigious project requires a successful track record in performing EPCC works for crude tanks, petroleum product tanks and pressurized storage tanks. With our engineering, procurement & construction expertise for the oil-and-gas, petrochemical, and pharmaceutical industries, coupled with KUB’s strength as Malaysia’s premier Class A Industrialised Building System and a Bumiputera contractor with its own in-house manufacturing and engineering capabilities, we are confident that this will put us in a good position for this bid.

“In Malaysia, we also see opportunities given that annual offshore oil and gas capex in the country is projected to increase 46% to US$5.7 billion in 2013 in the more immediate term. Underpinning the uptrend is the 2011 – 2015 expanded capital expenditure of RM300 billion committed by Petronas, Malaysia’s national oil company.”

The MOU is not expected to have any material impact on the earnings per share or the net tangible assets per share of the Group for the current financial year ending 31 March 2014.