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The government has endorsed a new plan of tax incentives proposed by Petronas which will be incorporated in the Petroleum Income Tax Act , Prime Minister said today. “By lowering risks and increasing the rewards for investment, this initiative will potentially lead to additional petroleum-generated revenue of more than RM 50 billion for Malaysia over the next 20 years” he said when announcing 9 new developments and Entry Point Projects of the Economic Transformation Program. Najib said there would be a notional trade-off of about RM 8 billion in the form of revenue foregone from investment tax allowances, reduced tax and the export duty waiver for marginal fields. The 5 new incentives are:- Investment tax allowance of capital expenditure. Reducing tax rate from 38% to 25% for marginal oil field development Accelerated capital allowance of up to 5 years from 10 years. Qualifying exploration expenditure transfer between non-contiguous petroleum agreements with...

After the successful listing of MMHE , Petronas is going ahead with the listing of another subsidiary - Petronas Chemicals Group Bhd (PCG). The IPO, which could raise as much as RM 13.02 bn (US$4.2bn), would be the largest in Southeast Asia, according to term sheet. Below is the summary of the IPO: PCG is one of the leading integrated petrochemicals producers in Southeast Asia region, with 45% of revenue derived locally. Better profit margin in rising crude oil environment as prices of raw material was supplied by Petronas. The management has earmarked to 50% payout of its earnings, which translates to a dividend yield of about 4% . Valuations... At retail price of RM5.05, the historical price-earnings ratio (PER) works out to be about 16 times. Upon listing... EPF and Kumplan Wang Persaraan will be cornerstone investors. To expand its business and synergistic-growth acquisitions for the next 5 years. To consolidate its petrochemicals activities to increase the efficiency and profitab...

MMHE is a wholly-owned subsidiary of MISC, which is 65% owned by Petronas . It has two main divisions namely engineering and construction (E&C), and marine conversion and marine repair . Its two fabrication yards were in Pasir Gudang (Johor) and Kiyanly (Turkmenistan). Being one of the 7 licensed offshore fabricators in Malaysia , MMHE tops both in terms of annual tonnage capacity and market share, mainly because backed by Petronas. Other fabricators were Sime Darby, Kencana, Boustead Heavy Industries, Brooke Dockyard, Ramunia and Oilfab. Meanwhile, its marine conversion business could expect more demand on its floating production system , driven by increased developments in deepwater oil and gas fields. In comparison, installation of fixed structures is not economical in water depths over 300m, thus, giving floating production an advantage. Key investment points: Almost guaranteed jobs from Petronas. International opportunities and technical know-how enhanced by strategic ...