Latest news with #Dialog
New Straits Times
2 hours ago
- Business
- New Straits Times
Strait of Hormuz risks could push oil above US$100 per barrel, Asia most exposed
KUALA LUMPUR: The potential closure of the Strait of Hormuz could sharply escalate geopolitical tensions in the Middle East and severely disrupt global oil supply chains, with Asia facing the greatest exposure, according to CIMB Securities. The research firm underscored the strategic significance of the strait, which handles nearly 20 per cent of global oil flows. With global oil supply projected to increase by 1.5 per cent to 104.35 million barrels per day in 2025, based on US Energy Information Administration (EIA) forecasts, any disruption could lead to widespread consequences for global energy markets. "Asia is particularly exposed, with China, India, Japan, and South Korea being the top destinations for crude oil moving through the Strait of Hormuz to Asia, collectively accounting for 69 per cent of crude oil and condensate volumes transported through the strait in 2024. "Any disruption to these flows could drive a renewed surge in oil prices, with inflationary spillovers extending across global economies," it said in a note. It said crude oil prices are expected to rise amid recent geopolitical tensions, with heightened volatility likely to continue in the short term. CIMB expects Brent crude to trade around US$85 per barrel in the near term, with volatility likely to persist amid elevated geopolitical risks. "Our analysis indicates that a supply disruption of 500,000 barrels per day (bbl/day) could result in a price increase of approximately US$10 per barrel, based on historical events. "The international sanctions imposed on Iran in 2011 to 2012 led to a supply loss of 1.4 million bbl/day, resulting in a US$30 per barrel increase in crude prices during that period. That said, the current global oil market is better cushioned by available spare capacity," it added. CIMB noted that OPEC+ currently has an estimated excess capacity of 5.7 million bbl/day, with Saudi Arabia and the United Arab Emirates contributing around 4.2 million bbl/day of that total. However, it highlighted a key risk: most of this supply is transported through the Strait of Hormuz, making it particularly vulnerable. "In our view, should the proposed closure of the Strait of Hormuz materialise, the risk premium could surge, potentially pushing Brent prices above US$100 per barrel," it added. The research house highlighted Dialog Bhd as a potential beneficiary of rising oil prices, mainly due to its upstream portfolio. The company currently operates three producing assets, including full ownership of the Bayan oilfield service contract, a 20 per cent stake in the D35/D21/J4 production sharing contract, and a 50 per cent interest in the L53/48 concession in Thailand. "These assets contributed approximately 35 per cent to Dialog's financial year 2024 core net profit. We estimate that every US$10 per barrel rise in the average Brent oil price assumption will boost Dialog's financial year 2026 core net profit by 2 per cent," it said. CIMB's current forecast assumes an average Brent oil price of US$71 per barrel for 2025.
New Straits Times
16-06-2025
- Business
- New Straits Times
Dialog-Petronas Mutiara cluster deal to drive long-term growth
KUALA LUMPUR: Dialog Group Bhd's newly awarded production-sharing contract (PSC) for the Mutiara Cluster Small Field Asset (SFA) with Petroliam Nasional Bhd (Petronas) is expected to strengthen the group's upstream portfolio and support its long-term growth trajectory. CIMB Securities said currently, Dialog operates three producing assets, namely the Bayan oilfield service contract, the D35/D21/J4 PSC, and the L53/48 concession in Thailand. It is also progressing with the BJC SFA PSC, following Petronas's final investment decision approval in January, with first production slated for January 1, 2027. "In addition, the group is in the pre-development phase for the RAJA Cluster SFA, awarded in December 2024. If the RAJA and Mutiara clusters prove commercially viable, Dialog's upstream portfolio could grow to six assets, providing stable income over the next decade," it said in a note today. The firm said Dialog's upstream segment currently contributes about 35 per cent to the group's bottom line. While limited details have been disclosed, it estimates capital expenditure for the Mutiara asset to range between US$10 and US$20 per barrel of oil equivalent (boe), depending on reserve size and water depth. This is broadly consistent with other marginal field developments in Malaysia. "With a total capex of US$235 million, this translates to roughly US$9.46 per boe, which is within the expected cost range for similar assets," it added. Although the deal will not deliver immediate earnings, CIMB Securities views the development as a positive strategic move to deepen Dialog's upstream footprint. "We maintain our earnings per share forecasts, 'Buy' call, and target price of RM2.50," it said.
The Star
13-06-2025
- Business
- The Star
Dialog wins 14-year PETRONAS contract for Mutiara Cluster field in Sabah
PETALING JAYA: Dialog Group Bhd had won a 14-years production sharing contract from Petroliam Nasional Bhd (PETRONAS), for the development of the Mutiara Cluster field in Sabah. In a Bursa filing, Dialog noted the contract was awarded to its wholly owned subsidiary Dialog Resources Sdn Bhd which will assume 100% participating interest and the role of operator for the marginal field cluster contract. The 14-year contract includes a two-year pre-development phase to prepare a field development and abandonment plan (FDAP) and assess the asset's commercial viability, followed by a two-year development period with production targeted by its end. The remaining 10 years will be allocated for the production phase, subject to PETRONAS' approval of the FDAP upon reaching the final investment decision. Dialog said its participation in the Mutiara Cluster contract complements its strategy to continue to expand and diversify across the energy sector and increase opportunities within the group. 'This is expected to create a robust platform for generating long-term sustainable revenue from oil and gas production, reinforcing Dialog's position as a leading integrated technical service provider,' it added. Dialog's shares closed at RM1.57 a piece today.
Borneo Post
13-06-2025
- Business
- Borneo Post
Petronas awards Sabah's Mutiara cluster to Dialog in first MBR 2025 Deal
Petronas said the Mutiara Cluster is the first PSC awarded under MBR 2025 and is expected to achieve first production by 2029. —Bernama photo KUALA LUMPUR (June 13): Petroliam Nasional Berhad (Petronas) through Malaysia Petroleum Management (MPM) has awarded the first Small Field Asset Production Sharing Contract (SFA PSC) for the Mutiara Cluster offshore Sabah under the Malaysia Bid Round 2025 (MBR 2025). The national oil company in a statement today said the contract covers a sub-block within the Sandakan Basin and was awarded to Dialog Resources Sdn Bhd (Dialog) as the sole operator with 100 per cent participating interest. It added that the Mutiara Cluster is the first PSC awarded under MBR 2025 and is expected to achieve first production by 2029. It said the Mutiara Cluster consists of five fields, namely Nymphe, Nymphe North, Kuda Terbang, Benrinnes, and Mutiara Hitam. 'Strategically positioned off the coast of Sabah's East Coast, the SFA PSC is envisioned as a catalyst to open up Sandakan Basin for further exploration. 'It also supports broader value creation and local participation, in line with Petronas' aspiration to unlock Malaysia's position as an attractive destination for upstream investments,' it said. MPM senior vice president Datuk Bacho Pilong said the award of the Mutiara Cluster marks progress in tapping the untapped potential of Sabah's East Coast. 'We welcome Dialog as a valued partner in this journey to deliver early and sustainable value from the Sandakan Basin. 'This award reflects the growing confidence in Malaysia's upstream opportunities and the competitive terms offered under MBR 2025. 'As an industry shaper, MPM remains committed to facilitating impactful partnerships and catalysing investments that not only advance national energy aspirations but also uplift regional development in collaboration with the Sabah State Government,' he said. He added that MPM is also looking forward to welcoming more investors to Block SB505, another key opportunity offered under MBR 2025 to unlock the Sandakan Basin's full potential. MBR 2025 oil and gas Petronas sabah
New Straits Times
08-06-2025
- Business
- New Straits Times
Dialog seen ripe for re-rating on potential tank terminal contracts
KUALA LUMPUR: Dialog Group Bhd's stock could see an upward re-rating once long-term tank terminal contracts for its Pengerang Deepwater Terminal (PDT) Phase 3 are secured. Hong Leong Investment Bank Bhd (HLIB Research) said near term potentials include storage leases for ChemOne's aromatics plant and Petronas' joint venture biorefinery. The firm maintained its forecasts and reiterated a 'Buy' call on Dialog, keeping the target price unchanged at RM2.59. "We believe the eventual award of long-term tank terminal contracts for PDT Phase 3 will help re-rate the stock, which is currently trading at a reasonable valuation of 16 times forecast earnings for financial year 2026, compared to its five-year mean of 23 times. "We like Dialog for its recurring income business model and its unique position in riding the future expansion of Pengerang via development of tank terminals," it said in a research note. HLIB Research also highlighted that Dialog's downstream engineering, procurement, construction and commissioning business has swung back to minor profitability in the third quarter of financial year 2025 (3Q25). It said the group had assured that there would be no further cost provisions in anticipation of the official handover of Melamine plant in Kedah and gas compressor plant in Kluang to Petronas by the second half of 2025. On the midstream front, HLIB Research said storage rates edged up slightly to S$6.4 (RM20.98) to S$6.6 (RM21.63) per cubic metre in 4Q25, compared to S$6 (RM19.67) to S$6.5 (RM21.31) over the past year. It noted that this uptick was driven by stronger storage demand from oil traders, spurred by increased crude supply from OPEC+ and softening oil prices amid escalating trade tensions and heightened demand uncertainty. "The temporary shortfall from upstream in 4Q25 should be mitigated by better midstream contribution," it said.
