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Regional Oil & Gas Summary

Core Content

The document provides an overview of the oil and gas market dynamics and investment reports for key players in the Asia-Pacific region as of June 22, 2015. It includes price movements, market updates, and analyst ratings for various companies and indices. The focus is on the impact of global and regional factors on oil and gas prices and the financial performance of related companies.

Main Market Trends

• Crude Oil Prices:

  • Brent crude oil rose by 0.5% to USD63.34/b.
  • WTI crude oil increased by 0.7% to USD60.38/b.
  • Dubai Fateh Spot fell by 0.3% to USD61.38/b.
  • China Daqing Spot dropped by 0.1% to USD59.43/b.

• Natural Gas Prices:

  • Singapore 92 RON Spot decreased by 0.7% to USD79.90/bbl.
  • Gasoil 500 ppm SG Spot declined by 0.1% to USD77.04/bbl.
  • 3.5% 180cst Fuel SG Spot rose by 0.4% to USD355.15/mt.

• Other Commodities:

  • Gold decreased by 1.2% to USD1,185.98/OZ.
  • USD-CNY exchange rate remained stable at 6.21.
  • DJI and S&P 500 indices showed positive changes, with DJI up 0.6% and S&P 500 up 0.6%.

News Headlines

• Saudi Crude Oil Stocks Likely to Draw Down:

  • Analysts at Barclays Capital predict that Saudi Arabia may draw down its crude and product stocks due to increased domestic consumption and high production levels to meet global demand.

• U.S. Oil Rigs Decline, but Up in Permian and Bakken:

  • U.S. oil drillers reduced the number of rigs by four, but added one each in the Permian and Bakken basins, indicating a recovery in activity due to higher crude prices.

• Oil Up Ahead of US Crude Contract Expiry:

  • Oil prices reversed losses and ended slightly higher as short-covering occurred before the expiry of the front-month US crude contract. Concerns about gasoline inventories and the Greek debt crisis initially affected prices.

• Petronas Hires Rig for Midleton Drilling:

  • Petronas has contracted a drilling rig for the Midleton prospect in the North Celtic Sea, off Ireland.

• Petronas Canada Gas Project Faces Challenges:

  • The C$36 billion Canadian natural gas export project faces opposition and legal challenges due to environmental concerns.

Our Latest Reports

Trans-Asia Oil & Energy Development

• Rating: BUY
• Date: 18 June 2015
• Key Points:
  • Earnings and target price were reduced due to delays in plant commissioning and lower Feed-in Tariff.
  • Earnings are expected to more than triple in 2016 with the operation of the 2×135 MW coal-fired power plant.
  • Valuations remain attractive.

Gas Malaysia

• Rating: HOLD
• Date: 18 June 2015
• Key Points:
  • FY15 spread guidance increased to MYR1.58/mmBTU from MYR1.10/mmBTU but dropped from MYR2.02/mmBTU.
  • IBR potentially begins in January 2016 with a pass-through mechanism.
  • Earnings revised by +68% for FY15, -12% for FY16, and -33% for FY17.
  • Target price was lowered to MYR2.65 (-12%), maintaining HOLD.

SapuraKencana Petroleum

• Rating: HOLD
• Date: 16 June 2015
• Key Points:
  • 1QFY1/15 results were in line with expectations.
  • Interim DPS was 1.35sen.
  • Margin pressure is expected in subsequent quarters due to cost-cutting by clients.
  • Maintain HOLD with a target price of MYR2.80.

Gas Malaysia (Surprise Hike)

• Rating: HOLD
• Date: 10 June 2015
• Key Points:
  • Gas selling price to increase by 10.3% effective 1 Jul 2015.
  • No details on the cost of gas were revealed.
  • Forecasts remain unchanged; maintain HOLD with an unchanged target price of MYR3.00.

Asia Oil and Gas Valuations

Asia Oil-Service Valuations

Analyst Contact Information

• HK/CHINA: Howard Wong, (852) 22680648, howardwong@kimeng.com.hk
• INDIA: Jigar Shah, (91) 226623 2632, jigar@maybank-ke.co.in
• INDONESIA: Pandu Anugrah, (62) 21 2557 1137, pandu.anugrah@maybank-ke.co.id
• MALAYSIA: Liaw Thong Jung, (603) 22978688, tjiaw@maybank-ib.com
• PHILIPPINES: Michael Bengson, (63) 28498840, micheal_bengson@maybank-atrke.com
• SINGAPORE: Yeah Chee Keong, (65) 6231 5842, yeakcheekeong@maybank-ke.com.sg
• THAILAND: Sutthichai Kumworachai, (66) 2658 6300 x 1400, sutthichai.k@maybank-ke.co.th
• VIETNAM: Le Nguyen Nhat Chuyen, (84) 844555888 × 8082, chuyen.le@maybank-kimeng.com.vn
  Truong Quang Binh, (84) 444555888 × 8087, binh.truong@maybank-kimeng.com.vn

Notes

• The data is sourced from Bloomberg and Maybank KE.
• The report includes forward-looking estimates and multiples for companies not under Maybank Kim Eng's coverage, derived from Bloomberg consensus.
• All averages are weighted by market capitalization.