PETRA target price upgraded by OSK

OSK Research has upgraded the target price for Petra Energy to RM1.44 from RM1.15 previously based on a higher price earnings ratio valuation of 10 times.

It said the improved outlook for the brownfield service provider was due to the greater emphasis being placed on environment concerns, especially after the BP oil spill.

In a research note, OSK Research said it has gathered from its sources that Petronas and its production sharing contractors would continue spending a portion of their capital expenditure on rejuvenating existing and old platforms.

Last Friday, Petra Energy announced it received three letters of awards from Petronas Carigali to provide hook-up and commissioning services to 3 oilfield projects, which include the PL-353, PL-357 and PL-70 SKO pipeline rejuvenation project, ERB West Development project (Phase I) and Phase II for the Betty Revisit 4 project.


"We are maintaining our FY10 forecast because we had earlier assumed some order book replenishment for the company," it said, adding that work on all three jobs, worth RM26.4 million, which began in April was expected to last until year-end. - Bernama