Yinson bags RM2.36 bil contract from JX Nippon

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KUALA LUMPUR (Feb 14): Yinson Holdings Bhd said its wholly-owned subsidiary has been awarded a contract worth US$578 million or RM2.357 billion from JX Nippon Oil & Gas Exploration (Malaysia) Ltd.

The contract, awarded to Yinson Energy Sdn Bhd on Tuesday (Feb 12), is for the provision of operations and maintenance (O&M) services for JX Nippon’s floating production storage and offloading (FPSO) facilities, the group said in a stock exchange filing today.

"The tenure of the O&M Contract is effective from 12 February 2019 and shall remain in full force until termination of the contract for the provision of EPCIC (engineering, procurement, construction, installation & commissioning) and leasing for the Layang FPSO facilities. The charter contract is for a firm period of eight years and comes with options for 10 extension periods of one year each," Yinson said.

As such, it said this O&M contract is expected to contribute positively to the group’s earnings for the financial year ending Jan 31, 2020 (FY20) onwards, until the charter contract is terminated.   

The value of the O&M contract assumes the extension options would be fully exercised.

The Nippon FPSO Facilities is expected to commence operations at the Layang field by the fourth quarter of this year.

Shares of Yinson closed unchanged today at RM4.08, for a market capitalisation of RM4.41 billion.