Sapuracrest

Petronas Carigali has extended the contract to Sapuracrest's tranportation and installation of offshore facilities that was awarded btw 2004-2006 for a further 3 years, ending in March 20010. Contract value has gone up by 50% to RM3bn. The works will be for the fields offshore of Terengganu, Sabah and Sarawak which include the Angsi, Samarang, Sumandak, Bekok and Bertam fields. The works would involve the installation of subsea pipelines and the transportation and installation of drilling, production and wellhead platforms. Hence contracts secured year to date have reached RM3.8bn. This include the extension of Exxon Mobil's RM200m contract for installation works at Tapis, Guntong and Jereh fields off Terengganu and aother RM606m contract from Murphy Oil for the instllatin and commissining of the 140km gas ipeline transportation from the Kikeh fields to the Labuan Gas Terminal. This will boost Sapuracrest's order book to RM6bn which will carry them for at east the next 3 years.

For 2008 the company should be making a net profit of R70m before jumping to RM170m in 2009. EPS will be around 6.2 sen and 15.1 sen respectively. I would expect Seadrill to continue buying shares even past the 20% threshold, and more contracts coming in soon. I see little resistance to the share prce hitting RM4 sometime this year. Considering the many oil and gas stocks already doubling or even tripling in share price with very small contracts to boast of, Sapuracrest is looking to be still my top pick from oil and gas plays.