New Silkroutes Group (NSG), a Singapore-incorporated company listed on the Mainboard of Singapore Exchange Securities Trading, has signed an MoU with China Shipbuilding Industry Equipment and Materials Co (CSEMC), a subsidiary of China Shipbuilding Industry Corporation (CSIC), to produce crude oil and petroleum products for the state-owned capital goods supplier.
The MoU also calls for the two companies to explore collaboration in China and Singapore. Under the MoU, NSG’s wholly owned subsidiary International Energy Group (IEG) will seek to bring high-quality oil and petroleum products into China for CSEMC.
For its part, CSEMC will provide the necessary support to help IEG realise its plans for managing and owning oil storage facilities. As part of the MoU, CSEMC will set up a company in Singapore to work with IEG.
Singapore-based IEG is NSG’s biggest revenue driver. It expects to generate more than US$225 million in revenue by the end of NSG’s financial year ending 30 June 2017, up from US$49.6 million for FY2016.
The expected increase will be driven by credit facilities worth US$110 million obtained from several international banks. These lines will increase IEG’s trade financing options and allow it to structure more profitable trades. IEG’s FY2017 revenue forecast assumes a monthly turnover of more than US$18 million.
In a move to further accelerate growth at one of the fastest-rising oil trading companies in Asia, NSG has added two executive directors to the board of IEG. With the appointment of Ms Cai Suirong and Mr Nelson Goh Kok Liang, IEG now has three executive directors, including Dr Goh Jin Hian, NSG’s Group CEO.
“The MoU with CSEMC will open doors for us into China’s energy market. As one of the world’s largest energy consumers, China offers a lot of growth potential to IEG,” Dr Goh said. Further afield, IEG has a joint venture with the government of Malta to develop the Southern European island into an energy trading hub between Europe and Asia. – BusinessNewsAsia.com