Malaysia's KFM to enter oil and gas business in Indonesia

Malaysia?s Kuantan Flour Mills Bhd (KFM) announced on Friday that it will be venturing into the business of oil and gas services in Indonesia through its subsidiaries PT Blue Water Indonesia (BWI) in Indonesia and Blue Water Oil Services Pte Ltd (BWOS), a Singapore based company.

The company said that on 26 April 2002 BWOS entered into a joint venture agreement with PT Patra Dok Dumai Dumai (PDD), a wholly-owned subsidiary of Indonesia?s state oil and gas firm Pertamina.

The proposed joint venture will undertake the business of processing and recovery of crude oil from oil sludge, and will be located in Dumai, Sumatra.

The proposed operational joint-venture and the responsibilities of each joint-venture party are set out in the JV Agreement. KFM and BWOS will provide the management and financial support for the joint venture while PDD and Pertamina will provide the facilities and the oil sludge.

KFM said it will take approximately 3 months for the infrastructure of the oil sludge processing facility to be ready for operations. Therefore, processing of the first batch of oil sludge will probably commence in 3rd quarter of 2002.

Local labor under the supervision of engineers from BWOS will be used for the construction phase. (robert)