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Velesto Secures Jack-up Deal with Hess

Source: www.gulfoilandgas.com 11/5/2019, Location: Asia

The Board of Directors of Velesto Energy Berhad (VEB) is pleased to announce that Velesto Drilling Sdn. Bhd. (“VED”), a wholly-owned subsidiary of Velesto Malaysian Ventures Sdn. Bhd. (“VMV”), which in turn is a wholly-owned subsidiary of VEB, has received a Letter of Award from Carigali Hess Operating Company Sdn Bhd (“Carigali Hess”), for the Provision of 10K Jack Up Drilling Rig for 2020 Drilling Programme (“Contract”), the approval of which was received today.

2. DETAILS
VEB Group will assign NAGA 8 for this Contract with an estimated contract value for firm period only of USD131,000,000 million. The Contract is expected to commence in the 2nd half of 2020, for a duration of three (3) years with three (3) extension options of six (6) months each.

NAGA 8 is a premium independent-leg cantilever jack-up rig that has a drilling depth capability of 30,000 feet and has a rated operating water depth of 400 feet.

3. INFORMATION ON PARTIES
3.1 Information on VED
VED was incorporated in Malaysia under the Companies Act, 1965 on 29 July 2003 and is deemed to be registered under the Companies Act 2016. VED is principally involved in the offshore drilling business and operations and other engineering services for oil and gas exploration, development and production in Malaysia and overseas.

3.2 Information on Carigali Hess
Carigali Hess is a joint venture Oil and Gas company between PCJDA Ltd, and Hess Oil Company of Thailand Ltd based in Kuala Lumpur engaged in gas production in Block A-18 of the Joint Development Area administered by the Malaysian-Thailand Joint Authority (MTJA).

4. FINANCIAL EFFECTS
The provision of the above mentioned services is expected to contribute positively towards the earnings and net assets of VEB Group during the contract period for the financial period ending 31 December 2020.

5. RISK ASSOCIATED WITH THE CONTRACT
The risks associated with the execution of the Contract are operational and execution risks, which will be mitigated and/or managed by VED, a company with a proven successful track record of undertaking drilling programmes.

6. CONFIDENTIALITY
The contents for this Announcement is in accordance with the terms of the Contract, which the Company has received the approval for the release of Announcement today, from Carigali Hess.

7. DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTEREST
None of the Directors and/or the substantial shareholders of VEB and/or persons connected with the Directors and/or substantial shareholders have any interest, direct or indirect in the above Contract.

8. STATEMENT BY DIRECTORS
The Board of Directors of VEB is of the opinion that the award of the Contract is in the best interests of VEB Group.

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