News

Petronas to take a hit from Canada pullout, but sees long-term domestic gains

Reuters
Petronas may have to write off up to $800 million for work already done at the $29 billion Canadian liquefied natural gas (LNG) project, but scrapping the project brings long-term benefits, analysts said on Friday. State-owned Petroliam Nasional Bhd (Petronas) announced on Tuesday it would not proceed with its proposed Pacific NorthWest LNG terminal in British Columbia mainly due to depressed prices. "A rough gauge indicates that Petronas holding a 62 percent stake (in the project) would probably see a write-down of $600-800 million as it has been the lead developer since 2012," said Chong Zhi Xin, principal Asia LNG analyst at energy consultancy Wood Mackenzie. "There has been significant investments in the environmental impact assessments, engineering design studies and commitments to build a pipeline," Chong said. Japan Petroleum Exploration Co (Japex), which had a 10 percent stake in the project, said it would take a loss of about C$102 million ($82 million). Petronas launched Canadian LNG project five years ago when gas prices were at a high and the market was bullish about such investments. Since then, global gas prices have fallen by around 70 percent. 'SIGNIFICANT INVESTMENTS' Petronas did not disclose its losses from the pullout. But in an email response to Reuters' questions, it said "significant investments" had been made since the project began in 2012. The company would continue developing its gas assets in Canada, it said. Malaysia's only Fortune 500 company, Petronas has driven the country's modernisation push over the last two decades. It is one of Malaysia's biggest employers, and accounts for nearly a third of the government's oil and gas-related revenue. Its headquarters in the towering Petronas twin towers in Kuala Lumpur is symbolic of the company, and with it Malaysia's, oil-driven growth over the last few decades. But as the oil boom turned to bust, Petronas slowed down. In 2016 Petronas announced widespread job cuts, its first ever of that scale, and also said it would cut spending by $50 billion over a four-year period. Dividends from the company, which accounted for about 12 percent of Malaysian government's revenue in 2015, have also shrunk. Petronas is expected to give a dividend of 13 billion ringgit this year, half of the 26 billion ringgit contributed just two years ago. DOMESTIC GAINS The pullout from the Canada project means Petronas can prioritise domestic projects, a pressing need for Malaysians frustrated with rising costs, unemployment and a deflated currency. One of them is the Refinery and Petrochemical Integrated Development (RAPID) project in the Pengerang Integrated Complex (PIC) development in Malaysia's southern state of Johor. The PIC is Petronas' biggest downstream project, worth $27 billion in total investment. Prime Minister Najib Razak, who is expected to announce economic stimulus measures ahead of general elections that must be called by mid-2018, has said RAPID will create jobs, raise standards of living and boost the economy in Johor, a key electoral state. "That is where I expect funds to go into, said Peter Lee, Asia oil and gas analyst at BMI Research. "The focus is domestic first. They would always like to invest in and maintain production at home before going overseas," Lee said, adding he doesn't expect Petronas to make any significant new investments in the near term. RAPID, which includes a 300,000-barrel-per-day oil refinery producing gasoline and diesel, is targeted to begin operations in the first quarter of 2019. Petronas is also expected to focus on other large-scale domestic projects, such as its second floating LNG vessel and developing gas fields in offshore East Malaysia, which could boost jobs and projects within the local oil and gas industry.

G-Shock released a limited edition watch for NS50, but you’ll be hard-pressed trying to get one

CASIO G-SHOCK's Facebook page
Yet another brand has jumped on the NS50 bandwagon. This time, it's Casio's G-Shock with its popular GX-56BB watch sporting an army-inspired design. Officially released at nine G-Factory outlets across Singapore on Friday morning, the watch features the classic GX-56BB face with a "pixelised camouflage print" strap. NS50 is the term used to refer to Singapore's 50th year of National Service. Casio announced the release of the limited edition watch on its Facebook page on Thursday morning, but did not say how much it would cost or how many pieces were produced. A staff at the G-Factory Premium store in Marina Bay Sands told Business Insider the watch went on sale at 10am at a retail price of $269. And they are selling out fast. When we called the G-Factory Premium store at around 3:20pm, we were told that there were "very few" pieces left. Around the same time, the store at Ion Orchard had already run out of the NS50 watch completely, while the Bugis branch only had one left. Good news for Casio, but many G-Shock fans are probably going to be disappointed. By 5pm, Business Insider counted 14 opportunistic sellers who had put up the watch for re-sale on online marketplace Carousell with asking prices ranging from $280 to $2,699.99. [caption id="attachment_359982" align="alignnone" width="959"] Screengrab showing G-Shock's limited edition NS50 watch listed on Carousell[/caption] Tough luck.

The 12 highest-paying jobs you can get with a master’s degree

For some high-paying jobs, a master's degree is a must.

How John McCain became the pivotal vote that sent the GOP’s healthcare efforts into disarray

Senator John McCain stunned America on Friday, when shortly before 2 a.m. he voted against Republicans' last-ditch effort to repeal Obamacare.

The FDA is trying to cut nicotine in cigarettes to non-addictive levels

In the US, tobacco kills more than 480,000 people a year. It costs society almost $300 billion annually in medical costs and lost productivity.

Send us your nominations for the UK Tech 100, a list of the coolest people in UK tech

We want to hear from you on the coolest people in UK tech.

Irish Taoiseach rules out ‘border for the Brexiteers’ between Northern Ireland and the Republic

The Irish government has said Theresa May's plans for the Irish border are unworkable, pushing for a sea border with the UK after Brexit instead.

What you need to know in advertising today

Everything that you need to know in advertising today.

We visited the regional chain that Southerners say is better than In-N-Out and Shake Shack — here’s the verdict

New Yorkers love Shake Shack. The West Coast swears by In-N-Out. But North Carolinians say that there's one burger chain that trumps them all.

Watch the dramatic moment when John McCain killed the GOP’s ‘skinny repeal’ healthcare bill

The Senate burst into audible gasps when McCain delivered the decisive blow to the GOP's "skinny repeal" bill early Friday morning.