KUALA LUMPUR: Yinson Holdings Bhd's rebidding of Petrobras' Parque das Baleias floating production storage and offloading (FPSO) project is seen as negative.
This was because the project would no longer be a "sure-win" for the company, according to Kenanga Research.
The firm said while Yinson was confident in winning the rebid given its huge costing advantages against potential competitors, the lower charter rates compared to the original tender could be inevitable.
"Scope and technical specifications of the project will most likely remain the same, but the delayed first oil date could mean that the contract may only be awarded in the third quarter of 2021.
"We believe the re-bidding exercise would also almost certainly result in lower charter rates as compared to Yinson's original tender," it said in a report today.
Petrobras has called for a rebid for the Parque das Baleias FPSO after reportedly pushing back the project's first oil date by a year to 2024.
Kenanga Research said in the original tender, Yinson had emerged the sole bidder with both parties in exclusive negotiations for the past one year, but the project had failed to materialise nonetheless.
"We believe Petrobras' limited bargaining power during negotiations, given the lack of options for FPSO providers, coupled with the weakness in oil prices, may have prompted the company to re-launch the bidding with hopes of attracting more pricing competition," it said.
Kenanga Research said beside the Parque das Baleias FPSO, Yinson was eyeing to participate in bids for another two mid-sized FPSOs — Enauta's Atlanta fields, off Brazil, and Limbayong field, off Sabah.
It said the awards for these projects were expected to be in the later part of 2021.
Kenanga Research has maintained its "outperform" call on Yinson with a lower target price of RM5.50 from RM7.10 previously.