In a filing today, Bumi Armada said the funds would be fully utilised to repay the associate’s US$930 million (RM4.35 billion) bridge loan facility.
The loan was utilised for the construction of a floating production, storage and offloading (FPSO) vessel known as Armada Sterling V (ASV FPSO) for operations offshore India.
A98/2, a venture between Bumi Armada and Shapoorji Pallonji group, owns the ASV FPSO which had been dry leased to its sister company, SP Bumi Armada Godavari Private Ltd (SPBAG).
SPBAG, a 30:70 venture between Bumi Armada and Shapoorji Pallonji, won a US$2.1 billion (RM9.82 billion) tender from India’s Oil and Natural Gas Corporation (ONGC) for the charter hire and operations of ASV FPSO at the KG-DWN-98/2 block, which is situated offshore the Godavari River delta in the Bay of Bengal for nine years.
At the moment, ASV FPSO is awaiting hydrocarbons from ONGC to conduct the necessary acceptance tests to achieve final acceptance, Bumi Armada said.
“The start-up of oil and gas production was initially targeted in Q1 FY2023. However, damage to the field’s critical subsea infrastructure had resulted in a delay in the first oil date,” it added.
Bumi Armada is an international offshore energy facilities and services provider with a presence in over 10 countries spread across three continents.
On Sept 6, Hong Leong Investment Bank (HLIB) Research upgraded Malaysia’s oil and gas (O&G) sector by giving it an “overweight” rating and revised the sector’s top picks by favouring Bumi Armada with a target price (TP) of 71 sen and Wasco Bhd, formerly known as Wah Seong Corp Bhd with a TP of RM1.25.
The research house predicted that Bumi Armada’s Kraken FPSO issue will likely be entirely resolved by FY2023 and assume full status quo in FY2024F.
The unplanned shutdown of the Armada Kraken FPSO, which is mobilised in the UK North Sea, has been restored following recent successful operational work.
Bumi Armada’s share price closed unchanged today at 52 sen, giving it a market capitalisation of RM2.99 billion.