PETALING JAYA: Coastal Contracts Bhd has formed a joint venture with its Mexican business partner Grupo Empresarial Alfair S.A.P.I. de C.V. to undertake an onshore gas sweetening plant project in Mexico for Petroleos Mexicanos (Pemex), a Mexican state-owned petroleum company via its wholly owned unit Coastal Marine Pte Ltd. (CMPL).
The joint venture company Coastoil Dynamic S.A. De C.V will be held on a 50:50 basis by e CMPL and Alfai.
The scope of work for the project comprises mainly engineering, procurement, construction, operation and maintenance for the gas sweetening plant.
The gas sweetening plant to be constructed at Ixachi field, Veracruz, Mexico, by the JVC, is capable for processing up to 180 mmscf of wet sour gas a day. The firm period for this contract shall be 32 months and with chances of further extension by Pemex.
The plant construction period is expected to complete within 120 days and the maximum contract value for the firm period is up to approximately RM258.7 million and subject to adjustment should there be further extension.
Alfair is part of Nuvoil Group that has 23 years of experience in natural gas handling and processing plants in Mexico.
“The form of strategic partnership with Alfair enables Coastal Group to diversify its earnings base in Mexico. With this newly established joint venture, Coastal Group would be able to gain a track record in onshore gas processing plant and further enhance its capabilities in terms of technology and technical know how in the midstream sector,” the group said in a Bursa filing.
Coastal executive chairman Ng Chin Heng added that he believes there are more opportunities in Mexico’s midstream sector in future.
“The trend of natural gas demand has continued to increase in line with the growth in industrial and power sectors. Natural gas is the main fuel used for electricity generation in Mexico. We are looking forward to build a long-term and mutual beneficial business relationship with Nuvoil Group to undertake more gas processing contracts in Mexico and even in other countries,” he said.
