The Oil & Gas names typically associated with the Singapore Oil & Gas sector are Keppel Corp (BN4), Sembcorp Marine (S51), Sembcorp Industries (U96), Ezion Holdings (5ME) and STX OSV Holdings (MS7). These are the five biggest Oil & Gas stocks listed on Singapore exchange (SGX). Price performances of these five stocks, which all provide oil equipment and services, have varied over the past 12 months from +5.5% for STX OSV to +166.0% for Ezion.
SGX also lists five companies involved in the exploration of oil and gas.
Four of these explorers are listed on the Mainboard while one explorer is listed on Catalist. Oil and gas explorers represent the upstream side of the industry with oil or gas reserves making up their primary assets. A core feature of oil and gas reserves as an asset base is that assets deplete and must be continually replaced through either drilling activities or acquisitions.
The five oil & gas exploration & production companies listed on SGX are as follows:
- Interra Resources (5GI), which is involved in exploration, field development and production of oil. Its portfolio of assets is made up of five contract areas in Indonesia and Myanmar. Last week Interra Resources transferred from Catalist to the Mainboard as discussed in this recent Market Update. Interra Resources has gained 279.1% over the past 12 months. Current full market capitalisation is S$197 million. The investor relation website can be found here.
- Loyz Energy (594) is involved in exploration and development. Its portfolio made up of assets in India, the United States and Australia and New Zealand. Loyz Energy is listed on Catalist with a full market capitalisation of S$132 million. Loyz Energy has gained 21.5% over the past 12 months. The investor relation website can be found here.
- Mirach (C68) is involved in oil exploration, appraisals and production. Its asset portfolio is located in Cambodia, South Sumatra and East Papua of Indonesia. Current full market capitalisation is S$58 million. Mirach has declined 30.3% over the past 12 months. The investor relation website can be found here.
- Ramba Energy (R14) is also involved in oil exploration, appraisals and production. The company’s portfolio of oil and natural gas assets are located in South Sumatra and West Java of Indonesia. Due to its holdings of a logistic business, Industrial Classification Benchmark (ICB) have Ramba Energy is categorised to Industrial Transportation Sector as discussed in a recent Market Update. Current full market capitalisation is S$192 million. Ramba Energy has gained 71.4% over the past 12 months. The investor relation website can be found here.
- RH PetroGas (T13) is involved in exploration, development and production of oil and gas. Its portfolio of assets is located in China, Indonesia and Myanmar. RH PetroGas completed its transition from an electronics manufacturer to an upstream oil and gas company in 2010. Current full market capitalisation is S$307 million. RH PetroGas has gained 4.2% over the past 12 months. The investor relation website can be found here.
The Industry Classification Benchmark currently categorise two of the above stocks to the Exploration & Production sector, Interra Resources and Mirach Energy.
Other stocks categorised to the ICB Exploration and Production subsector are China Aviation Oil (G92), Chemoil Energy USD (AV5), Sinostar PEC Holdings (C9Q) and Ouhua Energy Holdings (AJ2). China Aviation Oil is involved in the supply, distribution and trading of Jet Fuel while Chemoil Energy USD is involved in the distribution of marine fuel. Sinostar PEC Holdings is involved in the production of Gas and Ouhua Energy Holdings is involved in the processing of gas.
During last week’s SGX My Gateway event, Mr Peter Cockcroft provided an educational overview of the oil exploration sector in addition to the sector risks and the popular valuation methods used by broker research analysts. Risks that were detailed by Mr Cockcroft were related to exploration, geology, contracts, government, political, developmental, natural, terrorists, environmental, operational, corporate, commercial and labour.
Mr Cockcroft noted that the common forms of valuation of oil explorers are cash flow, break-up value, finding costs, return on investment and total enterprise value to EBITDA. The total enterprise value to EBITDA term simply allows a company’s cash flow to be viewed on a debt-adjusted basis, which takes into account financial leverage on the business’ price to cash flow ratio.
Source: SGX My Gateway