Malaysia's Coastal Contracts Bhd (Coastal or Company, and together with its subsidiaries Coastal Group or Group) revealed Friday that its wholly-owned subsidiaries, Coastal Offshore (Labuan) Pte Ltd, Thaumas Marine Ltd and Pleasant Engineering Sdn Bhd have collectively secured contracts for the sales of 3 Offshore Support Vessels (OSV) and 2 low-end vessels for an aggregate value of approximately $54.5 million (MYR 178 million).

Apart from the 2 OSVs which were sold to a repeat customer, the other 1 OSV and 2 low-end vessels were sold to new customers. With the securing of these latest sales, the total value of the Group’s vessel sales order book stood at approximately $367.9 million (MYR 1.2 billion).

All of these vessels are expected to be delivered in 2014 and 2015. Consequently, the revenue stream from these vessels is expected to contribute positively to the top and bottom line performance of the Group for the financial years ending Dec. 31 and Dec. 31, 2015. 

Ng Chin Heng, the executive chairman of Coastal, commented:

“I am pleased to announce that Coastal Group has secured its first batch of vessel sales orders for FY2014 with an aggregate value of approximately $54.5 million (MYR 178 million). With these new orders under our belts, Coastal Group’s cumulative vessel sales orders amounted to approximately $367.9 million (MYR 1.2 billion), which has demonstrated a strong performance of the Group’s shipbuilding division for FY2014.

Current crude oil price remains stable underpinned by the recovery momentum in the United States and the anticipated shift out of recession in the Eurozone. We are quite optimistic with the current OSV market as stable oil price will continue to spur oil majors to increase capex spending on exploration and production activities, especially for drilling activities. We believe there are more OSV needed to support the 2015-delivery rigs.”

Ng further added:

“With the current strong vessel sales order book and the recent win of jackup gas compression service unit charter contract, FY2014 shall be a busy year to Coastal Group. In addition, currently we are in the progress of clinching a contract for our maiden jackup which is scheduled for delivery in quarter three this year.  We are quite optimistic on clinching our first jackup contract this year.”