Listed Companies' Announcement

FEDERAL INTERNATIONAL (2000) LTD

NEWS RELEASE - FEDERAL'S SUBSIDIARY SELLS AN ACCOMMODATION AND WORK BARGE


FEDERAL'S SUBSIDIARY SELLS AN ACCOMMODATION AND WORK BARGE

September 7 2004, Singapore – Federal Hardware Engineering Co Pte Ltd, ("FHE") a wholly owned subsidiary of Federal International (2000) Ltd ("the Group") is pleased to announce that we have signed a Memorandum of Agreement (SALEFORM 1993) ("MOA") to sell its accommodation and work barge to Bumi Armada Navigation Sdn. Bhd. for a total consideration of US$11.3 million (approximately S$19.2 million) in cash.

As per our announcement dated 17 August 2004, point (b) "We were contracted to provide procurement of material for the construction of an accommodation and work barge for PT Gunanusa Utama Fabricators ("PTG") for offshore activities. Due to PTG breach of certain payment terms, we have reached a settlement with PTG in which we took possession of the barge and chartered the barge to PTG. We also have the right to sell the barge under the term of settlement. The Company has since then looked for buyers and is currently negotiating with certain potential buyers for the barge. The directors are of the opinion that, no disclosure is required as the barge is held in respect of the capitalisation of debts which the directors have to take in the ordinary course of business and none of the directors have any interests in the transactions."

We have found a buyer, Bumi Armada Navigation Sdn. Bhd., who will make a down payment of US$1 million upon signing of the MOA whilst the balance will be payable upon delivery of the barge to the buyer. The transaction is expected to be completed before 23 December 2004. The consideration for the sale transaction was arrived at on a willing buyer-willing seller basis.

Proceeds from the sale will be used for the Group's working capital.

The above transaction will have a positive material impact on the earnings per share and the NTA per share of the company for the financial year ending 31 December 2004.

None of the Directors or substantial shareholders of the Group has any interest, direct or indirect, in the above transaction.

About Federal International (2000) Ltd

Listed on the Mainboard of the Singapore Exchange, Federal International (2000) Ltd ("Federal" or "the Group") is a value-added distributor and provider of turnkey EPC (engineering, procurement & construction) solutions for the energy & infrastructure industries. Currently the group is principally involved in the distribution of flowline control products (e.g. valves, structural steel, steel flanges/connectors and pipe fittings) to the oil and gas, power, chemical and pharmaceutical industries.

Federal is also involved in upstream activities such as research & development and manufacturing of valves and valve-related equipment through its subsidiary – Houston-based HP & T Products, Inc. and KVC Co., Ltd (Japan) and KVC (UK) Ltd, in which it has acquired strategic stakes. By moving upstream into the design and manufacture of specialized valves and related products, Federal aims to be an integrated service provider and procurement specialist in the energy and infrastructure industries offering a complete one-stop service.

About Bumi Armada Navigation Sdn. Bhd.

Bumi Armada Navigation Sdn. Bhd. (BAN), a premier marine transportation company providing services to the regional offshore oil and gas industry, is currently the biggest offshore fleet operator in Malaysia with more than 33 vessels of various categories. BAN's core activities include provision of services at terminals, anchor handling, offshore and landing services, and the charter of vessels for floating production storage and offtake, SBM mooring, safety standby, accommodation workboat, utility, hose handling and hydrographic.

Issued on behalf of Federal (International) 2000 Ltd

For more information, please contact:

Ms Tham Moon Yee / Ms Geraldine Goh
Stratagem Consultants Pte Ltd
Tel : 65 6227 0502
Fax : 65 6227 5663
Email : tmy@stratagemconsultants.com / geraldine@stratagemconsultants.com


Submitted by Koh Kian Kiong, Director on 07/09/2004 to the SGX