KUALA LUMPUR (June 28): Petronas Dagangan Bhd (PetDag) has said it is disposing of working inventory and deadstock (un-pumpable inventory) in six fuel terminals for RM132.93 million.

The inventory, totalling 58.51 million litres of fuel, is sold as part of PetDag's efforts to eliminate exposure to movement of Means of Platts Singapore (MOPS), it said, thus ensuring its product cost to be reflective of current market prices.

The inventory is sold to Petroliam Nasional Bhd's indirect wholly owned subsidiary, Petco Trading Labuan Co Ltd (PTLCL), through six additional agreements under related party transactions (RPTs).

With the sale, PetDag no longer owns inventory at the selected fuel terminals. The management and ownership of all inventories have been transferred to PTLCL, it added.

In total, 14 of PetDag's selected fuel terminals have been identified under this new operating model. This is the third and final announcement in relation to the model, it said. In total, the inventory sale under the RPTs amounted to RM192.26 million.  

"The transfer of inventory ownership to PTLCL will eliminate the exposure of [MOPS] movement to PetDag especially when MOPS is on a downward trend which will have an impact to product price competitiveness as well as lag loss," it shared.

It also stressed that the transaction has no material impact on the earnings per share of the group for the financial year ending Dec 31, 2022.

Shares in PetDag rose 62 sen or 2.94% to close at RM21.68, giving it a market capitalisation of RM21.54 billion. Year to date, the stock has risen by 6.85%.