The company has allocated US$57 million in capital expenditure (capex) to invest in the new ships, its executives said on Monday.

The company will use $45 million of the total funds to buy a floating storage offloading (FSO) vessel for Chinese-Indonesian joint venture PetroChina International Jabung Ltd. (PCJL). The remaining $12 million, meanwhile, is for the purchase of a liquefied petroleum gas (LPG) tanker vessel for state-owned oil and gas giant Pertamina.

PCJL signed new contracts worth $76.32 million with the company in December 2017 in a deal that will last until 2023. It has also secured a long-term contract with Pertamina.

The purchases will be financed through a private placement in which the company will release 219.7 million shares to the public in June, with price per share set at Rp 796 (less than 1 US cent). From the corporate action, the company expects to raise fresh funds worth Rp 171 billion.

Proceeds from the private placement will be used for equity participation in its subsidiary PT Suasa Benua Sukses (SBS) in order to strengthen capital structure.

“Apart from the private placement, the funds for capex will be sourced from bank loans obtained from BNI [Bank Negara Indonesia] and KEB Hana,” president director Herjati said in a public exposé on Monday.

With two extra ships, the company expects to have a total 15 by the end of this year, adequate to support its efforts to achieve its revenue goal of $62.5 million, which is an increase of 35 percent year-on-year (yoy).

In terms of net profit, the company projects 5.42 percent yoy growth in net income to Rp 13.82 million.

Aside from the impact of owning a larger fleet, the company is confident as it expects that global oil and gas prices will be stable, or even increase this year, which will positively contribute to oil and gas upstream activities.

“The oil price in 2017 to 2018 has improved, reaching $67 [per barrel], an increase from around $48 [per barrel] in previous years,” independent director Sumanto Hartanto said.

As of Monday, the Brent crude oil price reached $78.45, higher than a week ago when it still stood at $76, Bloomberg data shows.

Given the upward trend in global crude prices, the Upstream Oil and Gas Regulatory Special Task Force (SKKMigas) is hopeful that investment in the upstream oil and gas sector can reach $12.6 billion this year, $810 million of which is projected to go to exploration, with the remainder going to exploitation.

Sillo Maritime Perdana, listed under the ticker SHIP on the Indonesia Stock Exchange (IDX), saw its revenue jump by 33 percent yoy to $12.33 million in first quarter of this year.

All of the firm’s revenues came from ship charter services, with the largest clients being China National Offshore Oil Corporation (CNOOC) SES Ltd. and PCJL.

However, during the first three months of the year, its net profit decreased slightly to $2.03 million.

The company stated its business was not affected by recent fluctuation in the rupiah since its liabilities and revenue were all in United States dollar denomination.

Aside from participating in new tenders, the company has embarked on inorganic and organic growth in order to support its business last year.

Its inorganic expansion was done through the acquisition of 52 percent shares from PT Pratama Unggul Lestari in June 2017. The corporate action enables the company to own two direct subsidiaries, namely Suasa Buana Sakti and Pratama Unggul Lestari, with its shares ownership in them reaching 50.84 percent and 52 percent, respectively.

In 2017, the company bought new ships, MT Andaman Sea, now called SHIP 111, and TB PW Teguh, now named TB S Cathrina.

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