Malaysia-listed investment holding company Techfast Holdings Bhd on Monday (15 March) said its wholly owned subsidiary company Fast Energy Sdn Bhd on 12 March entered into a Supply Agreement with Wise Marine Pte Ltd (Wise Marine) where Fast Energy will supply low sulphur fuel oil (LSFO), low sulphur marine gasoil (LSMGO), and high sulphur fuel oil (HSFO) to Wise Marine.
The Wise Marine Group is currently a marine fuel supplier at Port Klang and manages its own fleet of five vessels. It has recently acquired a new suitable vessel for the purpose of the supply agreement, according to Techfast Holdings.
As part of the agreement, Fast Energy will supply bunkers in the range of 10,000 metric tonnes (mt) to 30,000 mt each month to Wise Marine on the average price per metric tonne as reported by S&P Global Platts in Singapore (Mean of Platts Singapore), plus an agreed premium throughout the contract period effective.
The total contract value for the supply agreement is estimated at MYR 2,222,856,000.00 (USD 540,249,590) based on present market price reported on Mean of Platts Singapore and is valid for three years.
“The supply agreement will add to the revenue streams of Techfast and is expected to contribute positively to the earnings of the Techfast Group,” it said in a company filing.
“It is also in line with Techfast Group’s objectives to diversify its business into the large volume and potentially lucrative oil and gas sector. The oil and gas sector is expected to expand with surges of demand post pandemic. The current recovery trend of crude oil prices paints a bright prospect.
“The group will benefit from the current port congestion at Port Klang and other major ports in Malaysia and Singapore. It is also well positioned to gain from the demand expansion and recovery post the Covid-19 pandemic.”
In January 2021, Techfast announced plans to diversify into petroleum product and bunker fuel trading through a 35% acquisition in CCK Petroleum Sdn Bhd.
Manifold Times in late February reported Techfast establishing petroleum trading subsidiary Fast Energy as part of plans to enter the bunkering sector.
Related: Malaysia: Techfast starts oil trading unit, unveils bunker supplier ambition with proposed CCK Petroleum acquisition
Related: Malaysia: Techfast Holdings acquires 35% stake in bunker trading firm CCK Petroleum
Photo credit: Techfast Holdings Bhd
Published: 16 March, 2021
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