Singapore Petroleum Company Takes a Stake in Kakap PSC

Singapore Petroleum Corporation (SPC) announced that it will acquire the entire 15 per cent stake from the US-based Louisiana Land & Exploration Company (LL&E) for the Kakap Production Sharing Contract in the West Natuna Sea of Indonesia. SPC is a subsidiary of Keppel FELS Energy & Infrastructure (Keppel FELS). This acquisition is expected to be concluded in mid-July and is effective from January 1 this year.

The Kakap PSC is one of three PSCs in the West Natuna Sea which will supply natural gas to Singapore. Another Singapore-based firm, SembCorp Gas, has also executed a gas sales agreement with Pertamina early last year. In all, three PSC groups have already entered into a gas supply agreement with the Indonesian oil company.

Kakap PSC will contribute one fifth of the agreement's total gas sales volume of 2.5 Tcf over 22 years. Development of the gas fields and construction of the pipeline and other infrastructure are ongoing.

SPC and Keppel FELS' Chairman, Mr Choo Chiau Beng, said, "The acquisition by SPC will give it a strategic stake in the fast-growing gas market in this region and will position SPC to play an active role in supplying pipeline natural gas to Singapore."

SPC says its upstream investment in Kakap will expand its current downstream refining and marketing business and also widen and diversify its assets and earnings base to make it a more integrated oil company. (*)