Listed Companies' Announcement
FEDERAL INTERNATIONAL (2000) LTD
PRESS RELEASE - FEDERAL INTERNATIONAL SIGNS MOU TO FORM JV TO UNDERTAKE US$21.6 MILLION PROJECT IN INDONESIA
- STRATEGIC ALLIANCE TO SECURE MORE CONTRACTS IN INDONESIA.
Singapore, March 8, 2004 – Federal International (2000) Ltd ("Federal") today announced its Memorandum of Understanding ("MOU") signed with PT Jaya Wijaya Raya ("JWR"), to set up a joint venture company called Federal JWR Energy Pte Ltd ("Federal JWR"), to carry out EPC (Engineering, Procurement and Construction) projects for the oil and gas industry in Indonesia. JWR is an Indonesian oil and gas company engaged in a wide range of services including production facilities, integrated logistic, rental equipment, engineering and construction and other oil and gas related services.
Federal JWR will undertake its first contract worth USD$21.6 million. Awarded by TAC-Pertamina- PT Semberani Persada Oil (Semco), the contract is for the rental of production facilities for the Semberah Field Development project in Indonesia for a period of 5 years with an option for an extension of 3 years. The agreement also allows for the purchase rental equipment after the expiry of the 5 years rental.
The joint venture would also allow Federal JWR, a company incorporated in Singapore, to jointly pursue and execute turnkey Engineering, Procurement and Construction ("EPC") projects in Indonesia. Federal JWR provides the following services :
q Operation of production Facilities for oil and gas, petrochemical and associated industries;
q Turnkey EPC projects for oil and gas, petrochemical and associated industries;
q Supply chain management and logistic services;
q Commissioning services;
q Maintenance services;
q Consultancy works; and
q Other businesses relevant to the oil and gas industry.
Federal will hold a 40% stake in this Federal JWR with the balance being held by JWR. An initial paid-up capital of US $300,000 divided into 300,000 ordinary shares of US $1.00 each, and authorised share capital US $5 million divided into 5 million ordinary shares of USD1.00 each was agreed in principle.
This joint venture will be funded by internal resources initially, and is expected to have a positive material impact on Federal's group profitability and consolidated earnings per share for the current financial year. It is however not expected to have any material impact on the net tangible asset per share of the company for the current financial year.
None of the Directors or controlling shareholders of the company has any interest, direct or indirect, in the joint venture.
Mr K K Koh, Federal's Executive Chairman and CEO commented, "We are excited about this joint venture and we are pleased to be in partnership with JWR, a respected player in the oil & gas industry in Indonesia. We believe the joint effort could widen our group's scope of supply and services to our customers. We can serve as one stop integrated service provider for our customers in the oil and gas industry. We hope to take advantage of the current, continued robust growth in the oil and gas sector in the region to strengthen our positioning as well as to benefit from the growth.
"Together with our recent investment in Jambi, we are confident that the strategic moves by the Group will enhance our competitive position in the Indonesian oil & gas industry and to allow us to tap on the abundant opportunities in the huge unexplored reserves of natural gas and oil island. Moving forward, we expect to bid and secure more projects in Indonesia and grow our market share in Indonesia. With the continued robust demand for EPC services in Indonesia, we are optimistic of growth."
Just two months ago, Federal entered into a joint venture with PT Jambi Info Trade Centre, with a view to jointly promoting investment opportunities in the vast, resource-rich Jambi Province in Indonesia.
About Federal International (2000) Ltd
Federal 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 has incorporated HP & T Products, Inc. (a Houston-based company) and acquired strategic stakes in KVC Co. Ltd (Japan) and KVC (UK) Ltd, companies which are involved in upstream activities such as research & development and, manufacturing of valves and valve-related equipment. By moving upstream into the design and manufacture of specialised 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 package.
About PT. Jaya Wijaya Raya ("JWR")
PT. Jaya Wijaya Raya is a limited liability company incorporated in 2001 under Indonesia laws. Its core business activities which focus on the Oil & Gas Industry include: Build (EPC), Own & Operate Production Facilities for both Oil & Gas, Petrochemical and associated industries; Production Facilities Operation & Maintenance Services; Equipment rental & management; Engineering & Consultancy works, Supply Chain Management & Logistics for upstream & downstream; Marine & Transportation.
JWR currently has various contracts for major oil companies in Indonesia, specifically in the areas of Sumatra, Kalimantan & Java.
Release issued on behalf of Federal International (2000) Ltd
by Stratagem Consultants Pte Ltd
For more information, please contact
Ms Tham Moon Yee/Florence Tan
Email : firstname.lastname@example.orgemail@example.com
Tel : 62270502 Fax : 62275663
March 9, 2004
Submitted by Koh Kian Kiong, Director on 09/03/2004 to the SGX