Barakah Offshore Petroleum Berhad has announced that its subsidiary PBJV Group has received the letter of award from Sabah Shell Petroleum Company (SSPC) to replace the effluent discharge pipeline for Labuan Crude Oil Terminal (LCOT).

LCOT is a facility operated by Sabah Shell Petroleum Company (SSPC) and receives, dehydrates, stores and exports crude from the offshore fields in Sabah.

These fields are operated by SSPC, PETRONAS Carigali and Repsol through two incoming trunk lines.

"The contract carries a value of more than $5.77m."

Refined crude is transported through tankers and produced water is treated before it gets disposed to the South China Sea through the effluent discharge pipeline.

This contract includes engineering, procurement, construction, installation and commissioning of a new effluent discharge pipeline in LCOT.

The pipeline will be installed though the transportation and installation shore approach that strings new pipeline in the beach area at the proximity of LCOT. The pipeline then will be towed into deeper water and buried under the seabed.

Effective from October 2016, the contract carries a value of more than MYR25m ($5.77m).

This project is expected to be completed within two years.

Barakah Offshore Petroleum Berhad expects this contract to have a positive impact on its earnings and its net assets per share during the contract’s tenure.