KUALA LUMPUR: The offshore hook-up and commissioning (HUC) and maintenance, construction and modification (MCM) segments stand out as the two largest beneficiaries in Petroliam Nasional Bhd's (Petronas) Activity Outlook for 2022, Affin Hwang Capital said.

The firm said potential beneficiaries include Dayang Enterprise Holdings Bhd, Petra Energy Bhd, Carimin Petroleum Bhd and Deleum Bhd.

"In Petronas' recently-released Activity Outlook 2022-2024 edition, domestic activities are expected to benefit from a modest recovery, though partly due to jobs spilling over after having been affected by last year's delays.

"The HUC man-hours are projected to stage a strong 47 per cent year-on-year (Y-o-Y) recovery (from a budgeted 4.4 million in 2021 to 6.5 million in 2022). 

"The MCM man-hours are expected to see a slightly more modest 14 per cent increase (from a budgeted 10.1 million in 2021 to 11.5 million in 2022). 

"Notwithstanding the positive HUC outlook in 2022, activities are projected to decline 23-29 per cent Y-o-Y in 2023-2024 as a result of project deferments, while the MCM outlook is to remain stable," it said in a note today.

Affin Hwang said besides that, Petronas planned to decommission 31-50 wells yearly over the next three years, from a budgeted 13 wells in 2021, as more fields reach their end of life. 

This may benefit plug and abandonment service providers like Uzma Bhd and T7 Global Bhd. 

"The higher hydraulic workover unit (HWU) demand partly reflects the increasing abandonment work to be executed, which is projected to increase to six to seven units over the next three years (from a budgeted five units in 2021), likely benefiting operators like Velesto Energy Bhd and Uzma," it added.

Affin Hwang said the number of plant turnarounds were expected to rise to 11 facilities in 2022, from 10 facilities due to deferment.

This will likely benefiting maintenance players like Dialog Group Bhd and Serba Dinamik Holdings Bhd.

Affin Hwang said Petronas continued to hold a conservative view on global Brent crude oil prices with a US$50-US$60 per barrel forecast. 

This is below the firm's higher 2022 forecast of US$75-US$80 per barrel, representing a 10 per cent increase in prices from an average of US$70.7 per barrel in 2021. 

Affin Hwang has reiterated its "Neutral" rating on the oil and gas sector as activities recovery are on selective spaces rather than the broad sector. 

"For sector exposure, we continue to adopt a more defensive stance and prefer to position in the resilient maintenance and floating production storage and offloading (FPSO) segments," it said.