KUALA LUMPUR (June 24): Handal Resources Bhd's joint venture (JV) has bagged seven-year contract worth RM360 million from Petronas Carigali Sdn Bhd.

In a filing with the stock exchange today, Handal said the JV, Borneo Seaoffshore-Handal JV, had received a letter of award for the provision of water injection module supply on mobile offshore unit for mobile water injection facilities — package 4.

Handal said the contract is to commence from March 2020, with an extension option of a further three years.

The firm said the JV was set up to collaborate and submit the technical and commercial proposal to bid for and execute the contract.

Handal said its unit Handal Engineering Sdn Bhd and Borneo Seaoffshore Engineering Sdn Bhd have agreed on the scope and responsibility of each party under the JV and shall be jointly responsible for discharging all obligations under the contract.

It said the JV will remain valid throughout the period of the contract.

Handal said the contract is expected to contribute positively to its the financial period ending June 30, 2019 and subsequently until the expiry of the contract.

In a separate statement, Handal managing director Sunildeep Singh Dhaliwal said the company sees this business line as the first step in its strategy to reposition itself in the Malaysian oil and gas industry.

"This new contract is extremely important, as building our order book has been identified as the cornerstone of our turnaround plan.

"With the addition of this contract, our order book will surge to more than RM950 million, which will contribute positively to the group's financials until year 2027," he said.

Dhaliwal said Handal will continue to pursue contract tenders that will make its presence felt in the oil and gas industry beyond the firm's core crane business.

"It is our plan to consolidate our business in Malaysia and then expand into the region.

"The management team brings vast experience and technical knowledge in the oil and gas industry. Anchored on this, we are poised to provide value added services to our respective clients within the industry," he said.

At the midday break, Handal shares rose 5.26% or 2 sen to 40 sen with 1.08 million shares traded.