Reservoir Link appointed as panel contractor to PETRONAS research unit

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Reservoir Link on PETRONAS panel

Highlights

Reservoir Link Solutions Sdn Bhd, 60% owned by Reservoir Link Energy, has been appointed as a panel contractor to PETRONAS Research Sdn Bhd for three years from Sept 11.
The scope covers raw material supply, blending and chemical placement, with no fixed contract value; the volume of work depends on work orders and mini-tenders.
Reservoir Link shares fell one sen to 26.5 sen on Monday, giving it a market value of RM103 million before the appointment announcement.

This article was translated from the original. Read the original version by our correspondent here.

Appointment scope and contract term

According to The Edge Malaysia, citing a bourse filing, Reservoir Link Solutions Sdn Bhd, 60% owned by Reservoir Link Energy, has been appointed as a panel contractor to Bangi-based PETRONAS Research Sdn Bhd.

Under the appointment, the company will supply raw materials, provide chemical blending services and take responsibility for the full placement of chemicals at the site. The company said there is no fixed contract value; instead, the volume of work will depend on the work orders issued.

The appointment covers an initial three-year term from Sept 11, with an option to extend for a further two years. Reservoir Link also said the appointment does not guarantee any work orders, and the company may be invited to participate in mini-tendering exercises during the appointment period.

Impact on operations and market sentiment

In a statement, executive deputy chairman Thien Chiet Chai said the appointment across all three packages positions Reservoir Link to participate throughout the chemical placement value chain, from raw material supply and chemical blending to on-site execution.

For Malaysia’s energy services sector, arrangements of this kind could strengthen the position of local service providers in specialised technical support and operational work. However, the absence of a fixed contract value and the requirement to participate in mini-tenders mean the financial contribution will become clearer only when actual work orders are issued.

Reservoir Link shares fell one sen to 26.5 sen on Monday, giving the company a market value of RM103 million before the contract announcement was made after market close.

In our earlier report on the FBM KLCI’s weakness, the benchmark index fell as concerns over inflation and the U.S. interest rate outlook once again weighed on investor sentiment. We also highlighted selling pressure in technology stocks, as well as continued net selling by foreign institutions, which added to the burden on the local market.

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