Ezra and Emas Offshore to sell their stakes in Lewek EMAS vessel

Ezra Holdings' Lewek Constellation vessel.
Ezra Holdings' Lewek Constellation vessel. PHOTO: EZRA HOLDINGS

SINGAPORE - Ezra Holdings, a contractor and provider of integrated offshore solutions to the oil and gas industry, and a unit of its subsidiary, Emas Offshore, have accepted a non-binding letter of intent to sell at least their current combined 78.4 per cent equity interest in PV Keez Pte Ltd, a single purpose company which owns the FPSO Lewek EMAS.

The vessel is chartered to Premier Oil Vietnam Offshore BV, operator of the Chim Sao field offshore southern Vietnam. An FPSO is a floating production, storage and offloading vessel used by the offshore oil and gas industry.

Ezra and the Emas Offshore unit are expected to receive an aggregate consideration of a combination of cash and sellers credit, upon successful closure of the transaction, the companies announced on Friday (April 15).

The buyer was descibed as an international energy infrastructure fund.

Commenting on the divetment, Lionel Lee, Group CEO and managing director of Ezra, said: "This transaction is fully in line with the group's strategy to move away from ownership of FPSO assets and will allow us to streamline our resources. Furthermore, it will allow us to move towards capitalising on the capabilities and experience we have harnessed from FPSO conversions and to build a franchise based on providing higher value-added services."

Added Adarash Kumar, Emas Offshore's chief executive officer: "This transaction will enable us to strengthen our financial position and refocus the company's business in the offshore support sector during the current challenging times in the oil and gas sector."

Emas Offshore on Thursday posted a net loss after tax of US$140.5 million for its second quarter from a net profit of S$9.7 million a year ago due to weakness in the offshore industry.

Barring any unforeseen circumstances and subject to the entry into a formal and binding agreement and obtaining the requisite approvals, the transaction is expected to be completed by no later than the end of June 2016.