Elnusa to diversify business
Tuesday, December 18 2012 - 11:01 AM WIB
PT Elnusa has planned to diversify its business from its core oil and gas services in the upstream to downstream businesses during the period of 2013 and 2017.
?This is critically important for the company to make its income more stable than now. Our businesses in the oil and gas services sector is only short term in nature, making our income not sustainable,? Elia Massa, President Director of PT Elnusa, said during his company?s public expose in Jakarta on Tuesday.
The new ventures will include marine support services, logistics for oil & gas, and operation & management (O&M).
Elia Massa said that his company would still focus on the oil and gas services, but it will expand to energy services in the downstream sector,
?We also have a plan to venture to the power sector under the independent power producer scheme (IPP). But we?ll not enter the geothermal power plant and solar cell, although we?ll still provide services for the sub-sectors,? Massa added.
Until now, 95 percent of Elnusa?s income is derived from short term businesses, such as seismic, and other short term services for exploration.
He said that by the year 2017 it will change its income structure to 20 percent from short-term, 38% mid-term, and 42 percent long-term.
For the expansion, his company has allocated a total investment of US$398 million for the period of 2013 ? 2017.
In 2013 Elnusa will focus on the Oil Field Services (OFS) with 60 percent of the capital expenditure for buying equipment for pumping mud services & barges, 28 percent for subsidiaries, 8 percent for geo-science services, such as buying equipment for land seismic, and the other 4 percent for asset management.
?Around 72 percent of the capital needed for the expansion will come from bond issuance, 22 percent from internal cash, and the rest from rights issue planned in 2015. But all of the plans are subject to possible change,? said Nurcholis, financial division head of Elnusa.
For the year of 2012, Elnusa is expected to see its consolidated net profit to jump by 389 percent to Rp 123.6 billion. Last year, it suffered a loss of Rp 42,7 billion.
Editing by Benget Besalicto Tnb.