KUALA LUMPUR (Feb 11): Dialog Group Bhd has accepted an engineering, procurement, construction, and commissioning (EPCC) contract with an estimated value of up to RM724 million for a melamine plant for Petronas Chemicals Fertiliser Kedah Sdn Bhd (PCFKSB).

Dialog’s unit Dialog E & C Sdn Bhd (DECSB), which teamed up with Technip Energies (M) Sdn Bhd (TEM), was awarded the contract by PCFKSB.

PCFKSB is a wholly-owned subsidiary of Petronas Chemicals Group Bhd, which is engaged in petrochemical manufacturing, mainly producing granulated urea for use in the local and foreign agricultural industry.

TEM, formerly known as Technip Geoproduction (M) Sdn Bhd, is a subsidiary of Technip Energies, which is a leading engineering and technology company for energy transition.

DECSB's stake in the said consortium is expected to be 30%, while TEM will hold the remaining 70% stake.

In a stock exchange filing Friday (Feb 11), Dialog said the consortium of DECSB and TEM will build a new single-line melamine plant, including modifying the existing plant and utilities to meet the project's requirements.

“The scope of work of the project involves the engineering, procurement, construction and commissioning of a new melamine plant and bagging facilities. The engineering, procurement and commissioning scope will be executed by TEM while the construction and pre-commissioning scope will be undertaken by DECSB.

“The project is expected to commence in February 2022 and completion by the second half of 2024,” said Dialog.

Dialog said the letter of award was obtained through competitive bidding and the value of the EPCC contract was based on the scope of work specified by PCFKSB.

It added that the project is expected to contribute positively to the group’s earnings and net assets for the financial years ending June 30, 2022 onwards.

Shares of Dialog slipped two sen or 0.72% at RM2.77 at Friday’s midday break, with a market capitalisation of RM15.64 billion.