Oil Production In Joint Saudi-Kuwaiti Fields Could Restart “Relatively Quickly”
OTHERS Award of Contracts to Scomi Oiltools Sdn Bhd (SOSB) by Kuwait Oil Company
|SCOMI ENERGY SERVICES BHD|
Award of Contracts to Scomi Oiltools Sdn Bhd (SOSB) by Kuwait Oil Company
The Company is pleased to announce that its wholly-owned subsidiary, Scomi Oiltools Sdn Bhd (SOSB), has entered into contracts with Kuwait Oil Company, for the provision of mud products and mud engineering services for deep drilling dated 31 January 2019 and for the provision of mud products and mud engineering services for development drilling dated 4 February 2019 (the “Contracts”). The Company received consent to announce the Contracts from KOC via their letter dated 21 March 2019 which was received by the Company on 22 March 2019.
2. The Contract Value
The total estimated value of the Contracts is US$150 million (equivalent to Ringgit Malaysia 610 million).
3. Duration of the Project
The Contracts are for a period of 5 years commencing from the date of the execution of the Contracts.
4. The effect on Net Assets of the Group
The Contracts will not have any material effect on the Company’s Net Assets for the financial year ending 31 March 2019. They are expected to contribute positively to the Company’s earnings over the period of the Contracts.
5. The risks in relation to the Contract.
The risks of operating in a new country which include the political risk and regulatory environment in Kuwait would be mitigated by the Company’s global experience in the drilling fluids business and familiarity with operations in the Middle East region, track record of the Company’s products and services offering and the Company’s good rapport with local business partners.
6. Directors' and Substantial Shareholders' Interest
None of the Directors or substantial shareholders or any person connected to the Directors or substantial shareholders of the Company have any interest, either directly or indirectly in the Contracts.
7. Statement of the Directors
The Board of Directors of the Company is of the opinion that the Contracts are in the ordinary course of business and is in the best interests of the Company.
8. Financial effects
In addition to the Company’s information disclosed, the Management would like to inform that the Contracts will have a positive effect on the Earnings Per Share. The Contracts however will not likely to have an effect on the dividend policy, gearing, share capital and the substantial shareholders’ shareholdings of the Company for the financial year ending 31 March 2019.
This announcement is dated on 25 March 2019.
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