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* 2014 net income seen flat or modest growth
* Analysts had forecast growth of 16 pct
* Still aims for $862 million in net income by 2015
* Work at In Salah project at half normal levels
* Shares down more than 15 percent, hit 4-month low (Adds CEO comments, detail)
By Stephen Eisenhammer
LONDON, Nov 18 (Reuters) - Energy services group PetrofacLtd has warned it expects little or no growth next year,putting in doubt a 2015 target which has been an important focusfor investors and sending its shares down more than 15 percent.
A Thomson Reuters I/B/E/S poll of analysts had previouslyforecast net income growth of about 16 percent for next yearfrom Petrofac, which designs and builds oil and gasinfrastructure and also invests alongside oil firms in oilfields.
Onshore contractors in the Middle East such as Petrofac havefaced greater competition in recent years from Chinese firmsseeking to undercut European and U.S. rivals. Recently oilcompanies have also been delaying projects as their investorsdemand a more disciplined investment strategy.
Fellow oil service providers have also struggled this year,with the likes of Saipem, Aker Solutions andSubsea 7 all being struck by project delays and profitwarnings.
Petrofac said it still aimed to hit its target of $862million in net income by 2015, but next year's guidance nowmeans the firm needs to see a jump of about a third in thatfinal year.
Petrofac has long highlighted its aim to double 2010 netincome by 2015, with investors and analysts regarding it as akey benchmark for the firm's medium term prospects.
"If we slip from that target it won't be by hundreds ofmillions (of dollars) but by tens of millions," Chief ExecutiveAyman Asfari told analysts on a call. "This whole trend ofcapital discipline from the clients generally ... is justgetting things to take a little longer."
Its shares were down 240 pence at 1,199p by 1114 GMT, havingslumped as low as 1,190p, their lowest in more than four months.
BIG STEP
The forecast income leap in 2015 is expected to come mainlyfrom Petrofac's Integrated Energy Services (IES) division, whichtakes equity stakes in oil fields, as significant productioncomes on stream in projects in the North Sea, Malaysia andTunisia.
The rest of the earnings growth will have to come from moreconventional service contracts, the timing of which ChiefFinancial Officer Tim Weller said was crucial.
"It looks like a very big step up, hence we felt itimportant to lay out the building blocks," Weller said.
Petrofac said it was on track to deliver modest growth thisyear, in line with revised guidance given in May.
Next year's revenue will be hit by the rephasing of theUpper Zakum project in Abu Dhabi and the second stage of theBerantai project in Malaysia, the company said.
"It's more of a timing difference than any great fundamentalissues regarding our business," Weller said.
Petrofac had revised down its 2013 net income forecast to"modest growth" from "good growth" due to the delayed restart ofthe In Salah gas plant in Algeria, where it provides engineeringservices.
The site was closed after an Islamist attack on anotherAlgerian complex, In Amenas, in January.
Asfari said work on the project, run as a partnershipbetween state-owned Sonatrach and western oil companies BP and Statoil, had now resumed but was still wellbelow normal levels due to lingering security concerns.
"We have actually remobilised the site for some activitiesbut not everything ... We're doing work today but probablyhandling about 40 or 50 percent of activities we would otherwisehave handled," Asfari said. (Editing by Louise Ireland and David Holmes)
