Northbridge Industrial Services (LON:NBI), the industrial services and rental company, has today announced that the five joint tender contracts originally awarded to Tasman’s Joint Venture partner in Malaysia, Olio Resources SDN BHD, have been extended for a further two years on improved terms.
The original contracts were awarded to Olio for a three year term in November 2016 at the depth of the downturn in the oil and gas market. The JV between Olio and Tasman started at the beginning of 2018, with Tasman and its subsidiaries Tasman South East Asia (based in Malaysia) and Tasman Asia Pacific (based in Singapore), supporting the JV in the supply of drilling tools and services to Petronas and its partners in the region.
The improvement in terms relate to inspection and repair services which are offered alongside the rental of oil tools to the joint tender partners, who include five of the top international Oil and Gas operators in the region.
Whilst the JV is currently loss making, this extension with revised terms coupled with improving revenues, will make a substantial contribution to reducing the deficit in FY 2020 and, if revenue continues to improve as expected, to generating profits for Northbridge from FY 2021.
Other businesses within the Group continue to make good progress and the Board is confident that Northbridge is in line to meet current management expectations.