KUALA LUMPUR (July 9): Debt-laden Practice Note 17 (PN17) firm Barakah Offshore Petroleum Bhd said it has been notified by national oil firm Petroliam Nasional Bhd (Petronas) that its unit's licence has been suspended.

In a filing with the stock exchange today, Barakah said its unit PBJV Group Sdn Bhd had received notification of the suspension yesterday.

Barakah said the letter from Petronas indicated that there was an adverse report from Petronas Carigali Sdn Bhd (PCSB) pertaining to the non-performance of PBJV in relation to the contract for the provision of underwater services for PCSB.

"Resulting from that, Petronas has decided to suspend PBJV's licence for a period of three years with effect from the date of the letter," it said.

Barakah said the implication of the suspension was that Petronas including its subsidiaries and any petroleum arrangement contractors (PACs) will not award any new contract to PBJV during the suspension period.

It said PBJV will not be allowed to bid for new projects undertaken by Petronas including its subsidiaries and any PACs during the suspension period.

"Nevertheless PBJV is still allowed to continue and complete its existing and ongoing contracts with Petronas including its subsidiaries and PACs in accordance to the term and conditions of the respective existing and on-going contracts," it said.

Barakah said it will seek clarification from Petronas and appeal against the suspension.

Meanwhile, Barakah appeared to have found a white knight, Singapore's Lecca Group Ptd Ltd, to revive its financial health.

The firm has proposed a regularisation plan that includes the disposal of a pipelay barge to Lecca Group, as well as a share capital reduction, share placements, plus debt settlements through issuing redeemable unsecured loan stocks (RULS) after a total waiver of RM153.99 million owed.

Barakah, in its filing with Bursa Malaysia on July 8, said it is proposing for its unit PBJV to sell the pipelay barge, a long flat-bottomed maritime vessel, to Lecca Group for US$21 million (approximately RM88 million) in cash based on market valuation.

At the midday break today, Barakah rose 18.18% or 1 sen to 6.5 sen for a market capitalisation of RM54.33 million.

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