SAPCRES, KENCANA & Petrofac in JV to develop Berantai oil field

• SAPCRES, KENCANA and Petrofac Energy Developments, a unit of London-listed Petrofac, has entered into a JV to develop and operate the Berantai field located 150km offshore Terengganu.
• The interest of each Operating Party under the JOA is as follows:

1. Sapura Energy Ventures - 25%
2. Kencana Energy - 25%
3. PED - 50%

• A risk service contract (RSC) was signed by Petronas and the operating parties. The contract would be for 9 years commencing Jan 31, 2011 with first gas from the project expected by the end of Dec 2011.
• Under the agreement, the operating parties would provide 1 well-head platform with 18 wells (expected to be completed by end-2012) together with related pipeline linking it to another existing platform and the provision of a floating production, storage and off-loading vessel (FPSO).
• The operating parties would also have the right to deploy works and services to the project while a second well-head platform would be installed in a subsequent phase.
• The total development cost including for the subsequent phase, to be incurred collectively by the operating parties, was estimated at this juncture at approximately US$800 million excluding the provision of the FPSO.
• The RSC from the JV are  expected to have a positive impact on the net asset, net asset per share and earnings per share of the companies involved.
• KENCANA target price RM3.05