KUALA LUMPUR (May 25): Puncak Niaga Holdings Bhd is still holding on to its loss-making oil and gas (O&G) business, despite the challenging global O&G environment brought about by low crude oil prices, as the group is confident the industry will see some improvement next year.

Executive chairman Tan Sri Rozali Ismail said the group is not looking to dispose its O&G operations, represented by Puncak Oil & Gas Sdn Bhd and its subsidiaries GOM Resources Sdn Bhd and KGL Ltd, any time soon.

"We still have our O&G subsidiaries, and maintained some staff to manage our assets. We are not in a hurry to close down the subsidiaries. Even though there are not many jobs, we are still confident, and our exposure to the industry is not that big," he said at a press conference, following Puncak Niaga's 19th annual general meeting today.

"At the moment, all O&G contracts have been completed, so we don't have any ongoing jobs. We are still putting in tenders here and there, and are looking for opportunities," he added.

He said the group's confidence in the O&G sector, stems from belief that crude oil prices will stage a rebound, after declining earlier this year.

"The price of crude oil fell earlier this year, but last week, it was trading higher at around US$48 to US$50 per barrel, which was encouraging. It is possible that prices can reach US$60 to US$70 by year end.

"We expect conditions to improve further in 2017," said Rozali.

Meanwhile, he said Puncak Niaga will continue to be involved in the water segment, even after the disposal of its water assets, and is eyeing opportunities to expand its operations in familiar areas such as water and wastewater, sewerage, environmental engineering and construction, as well as new areas such as oil palm plantation and property development.

For the water segment, the group has secured jobs in Labuan for operations and maintenance, and waste treatment in Kuala Lumpur, with the group eyeing more contracts in the future.

The group has also signed a heads of agreement (HOA) with property developer TRIplc to acquire the latter's business.

"We are currently going through the due diligence works for TRIplc, which will probably be completed by the next two months. And after that, we will bring it to the board for deliberation. Altogether, the process will take about four to five months to complete and make the final decision for the acquisition," he said.

Puncak Niaga is also pursuing opportunities in the plantation sector and has identified a potential estate to acquire. Rozali did not reveal details of the acquisition, but said the group will be making an announcement soon.

"We are a cash rich company, after the disposal of our water assets. Now we are looking into good businesses to invest in, such as in the water and environmental engineering business, plantation, property, and [are] also open to mergers and acquisitions. We are doing many evaluations now, and will make the announcement soon on the target companies we will be investing in," he said.