1. Introduction

The Board of Malaysia Marine and Heavy Engineering Holdings Berhad (“MHB”) is pleased to announce that its wholly-owned and major subsidiary, Malaysia Marine and Heavy Engineering Sdn Bhd ("MMHE")  had entered into a subcontract for an offshore substation (OSS) high voltage direct current (HVDC) platform consisting of topside and jacket for Ijmuiden ver Alpha Project from Petrofac International (UAE) LLC (“Petrofac“) dated 24 November 2023 (the "Subcontract”). The value of the Subcontract is around RM1.2 billion.

The consent from the relevant Parties, for MHB to release the Subcontract information to Bursa Malaysia Securities Berhad was obtained on 29 November 2023. 

2. Salient Terms

The Subcontract scope consists of construction engineering, fabrication, mechanical completion, load out and sea fastening, and architectural works on engineering, procurement and construction (EPC) basis. 

This OSS platform will comprise a topside, weighing approximately 30,000 tonnes (including overall equipment) and a jacket, weighing approximately 10,000 tonnes. The duration of the Subcontract is approximately 54 months with fabrication to begin in 2025 and completed by 2028.

In addition, MMHE and Petrofac will collaborate towards the possibility of fabrication works for two (2) additional units of OSS of similar size. 

3. Financial Effect

The Subcontract will not have any effect on the share capital and shareholding structure of MHB. The Subcontract is expected to contribute positively to the earnings and net assets per share of MHB for the financial year ending 31 December 2025 and beyond up to the completion of the Subcontract.

4. Risks

The success of the Subcontract might be affected by various risk factors such as execution risks, weather conditions, and any operational and commercial impacts caused by political and economic uncertainties at both local and global levels, as well as the impact of pandemics or other endemic diseases. Notwithstanding the risk factors, MMHE has established a successful track record in undertaking similar projects.

5. Director’s and Major Shareholders’ Interest

None of the directors or major shareholders of MHB or persons connected to them has any interest, direct or indirect, in the Subcontract.

6. Directors' Statement

The Board of Directors of MHB, after considering all the aspects of the Subcontract is of the opinion that the acceptance of the Subcontract is in the best interests of MHB.

This announcement is dated 29 November 2023.