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| Courtesy Ranhill Berhad |
| Ranhill CEO Dato’ Hamdan
Mohamad leads many of Malaysia’s infrastructure
development projects. |
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| Courtesy Ranhill Berhad |
| Ranhill’s development
projects in Malaysia include constructing the
Kuala Lumpur International Airport and the Muar
Bypass. |
It comes as little surprise that Ranhill Berhad
was the mastermind behind the structural engineering
of Kuala Lumpur’s Petronas Twin Towers, currently
the world’s tallest buildings.
As Malaysia’s largest engineering contractor,
known for its cost-reduction initiatives and technical
innovations, Ranhill has been involved in most of
Malaysia’s major nation-building construction
projects, including the North-South Expressway linking
40 major Malaysian towns and cities along the 527
miles between Thailand in the north and Singapore
in the south, the state-of-the-art Kuala Lumpur International
Airport (KLIA) and light rail transport system (LRT),
and the development of the Selangor Water Supply Scheme.
A fully-integrated engineering enterprise, Ranhill
offers world-class engineering, procurement, and project
management services as well as turnkey construction,
facilities management, and development and ownership
of projects.
"We believe Ranhill has the makings of an infrastructure
giant," states JP Morgan Malaysia in its February
2003 report initiating coverage on Ranhill Berhad
with an overweight rating and Ranhill Utilities with
a neutral rating. An overweight rating indicates strong
growth potential and under-ownership by foreign investors,
while a neutral rating indicates a fair market valuation.
Over the course of 30 years of steady expansion and
growth, Ranhill has developed from an engineering
partnership formed by Australian engineering company
Rankine and Hill into a “one-stop shop”
for infrastructure-provision projects, including everything
from transportation (rail, roads, and bridges) to
electrical and mechanical, structural and civil, utilities
(water and power) supply and distribution, environmental,
logistics (ports, harbors, and airports), communications,
healthcare, educational complexes, and oil and gas.
With 30 percent of its engineering work coming from
overseas, Ranhill is garnering worldwide recognition.
Projects throughout the Middle East, Africa, the Indian
sub-continent, Southeast Asia and the Far East have
solidified its global presence. The Ranhill group
of companies has been “aggressive,” says
JP Morgan, in its overseas bidding, namely in West
Java, India, and Lebanon as of late.
On the home front, Ranhill Utilities has a 30-year
concession, expiring in 2029, to source, treat, and
supply water to the state of Johor. It anticipates
spending nearly $ 3.7 billion on capital expenditure
works to increase the treatment and distribution capacity
in Johor by 1,337 Mld during this period. Talks are
currently underway for Ranhill Utilities to build
water treatments plants in Tamil Nadu, India. The
company is currently examining possibilities in Lebanon
(water supply and sewerage) and Indonesia as well.
In December, Ranhill announced plans to acquire EPE
Power Corporation, a formerly publicly owned and operated
power plant in the state of Sabah. The acquisition
will allow Ranhill to participate in the expansion
of the facility’s capacity from the current 120MW
open cycle to a 180MW combined cycle.
Ranhill’s engineering and construction arm provided
piling works, pile caps, and pier concreting for the
Muar Bypass project, a bridge designed to relieve
traffic congestion in Bandar Muar, Johor. It is expected
to be involved the project’s $27 million extension
project. It also anticipates constructing the new
$160 - $190 million Women’s and Children’s
Hospital in Kuala Lumpur.
According to a recently signed letter of intent, Ranhill’s
construction work will be expanding to a location
a bit closer to American shores. The group will be
involved in the construction of a new roadway in Jamaica.
The Montego Bay bypass road project will involve the
construction of a 7.4 mile dual carriageway, expected
to commence in 2004.
Oil and Gas is another core business sector for Ranhill.
The company gained early exposure to the oil and gas
industry through its collaboration with Fluor Daniel
from 1985 and through the early 1990s. After a joint
venture with multinational Worley Limited in 1995,
Ranhill began to flourish in both the upstream and
downstream oil and gas markets. This partnership was
initiated when Kamarulzaman Omar (or “KO”
for short), a schoolmate of CEO Dato’ Hamdan
Mohamad, came aboard.
In one of its earliest oil and gas projects, Ranhill
provided over 100,000 hours of conceptual design,
detail engineering, and procurement and construction
services for NNPC’s $250 million Bonny Export
Terminal Project in Nigeria.
Some of Ranhill’s other major oil and gas initiatives
include the conceptual design for Carigali-Triton’s
Cakerawala Offshore Gas Field Development and Qatar
Petroleum’s Bul Hanine Offshore Gas Recycling
project. Recently, Ranhill was contracted by Shell
to undertake the design for the rejuvenation of offshore
gas fields servicing the LNG plants in Sarawak, Malaysia.
In the immediate term, Ranhill is expected to be contracted
on engineering projects for the Greater Nile Petroleum
Operating Company (GNPOC) in Sudan. In February 2002,
Ranhill completed drainage works, culvert construction,
and installation of road furniture for 24.9 miles
of road under the Sudan’s Keilak Road Phase I
project. This road will be used primarily for pipeline
maintenance works for GNPOC.
Dato’ Hamdan and KO are both trained engineers,
graduates of Malay College, Malaysia’s most prestigious
high school, and were MARA- Colombo Plan scholars,
a program which targets high achieving students to
be fast-tracked into tertiary studies.
KO sees opportunities for Ranhill to participate as
engineers and builders in the Iraq reconstruction
process as well. “There’s a lot of work
to be done to build and repair the relations between
the allied nations and the rest of the world. One
of the ways is through business.” It would be
pragmatic for American companies entering the Iraq
reconstruction to have alliances with Muslim companies
to “ease the acceptance of allied participation
in reconstruction.” According to KO, Ranhill
would be willing to participate in the rebuilding
process in Afghanistan, the Sudan, Iraq, and elsewhere.
Foreseeing a greater level of acceptance by the Iraqi
people for restructuring work done by a Malaysian
and thus predominantly-Muslim firm, a unique angle
exists for partnerships between American and Malaysian
companies qualified to participate in the rebuilding
process.
“We can differentiate on the basis of a better
understanding of the needs of an underdeveloped nation,”
explains KO. “Having been involved in nation-building
activities, we understand the sensitivities involved.
Malaysians have a unique mindset that allows for political
issues to be approached in a constructive, engaging
manner.”
“Iraqis have a strong attachment to American
quality products,” says KO. When sanctions closed
down opportunities for American companies to operate
in Iraq, companies from other parts of the world were
engaged, using non-American technology. “The
Iraqis were not happy,” says KO. “They were
used to American products.” It is likely that
Muslim-run companies specifying American products,
such as wellheads and oil and gas production equipment
and systems, would be highly favored.
Ranhill has worked with many best-in-class companies
and shares a strong association with technology leaders
like Black & Veatch, Bechtel, and Fluor Daniel.
Ranhill’s turnover grew by 46 percent last year.
“Because of our long-standing partnerships with
American companies,” says KO, “there is
a lot of scope for further collaborations.”
The company’s cost-effectiveness is an oft-cited
factor in contract winning. While in the U.S., the
average engineer’s hourly charge rate for detail
design is between $80 and $100, an equivalently trained
Malaysian engineer earns just $30 per hour, a rate
substantially lower than Europe and Japan’s averages
of $80-$90 per hour or Australia’s $70 per hour
average.
Ranhill has completed over 1,500 projects and has
grown to a workforce of 1,900 in seven operating subsidiaries
focused on engineering and construction of Oil and
Gas, Infrastructure and Utilities (Power and Water).
Ranhill was recognized as the “Best Newly Listed
Company in Malaysia 2001,” receiving Asiamoney
magazine’s prestigious award on the basis of
the Southeast Asian region’s investment community’s
perception.
For more information on Ranhill,
please visit www.ranhill.com.my.
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