PowerSeraya Seals Gas Contract With Gas Supply Pte Ltd

PowerSeraya Seals Gas Contract With Gas Supply Pte Ltd To Guarantee Uninterrupted Power Supply to Customers

12 May 2004 – Today, PowerSeraya Ltd (PowerSeraya) and Gas Supply Pte Ltd (GSPL) signed a Back-Up Gas Contract which enables PowerSeraya to buy gas from GSPL. This would enhance PowerSeraya’s ability in providing its customers with a more stable and reliable source of power.

The commercial arrangement between the two parties is in the form of a side letter agreement to the End User Agreement (EUA) originally signed between PowerSeraya and GSPL on 12 February 2001 for the sale and purchase of 80 Bbtud of natural gas which would take effect from 1 January 2006. This side letter allows PowerSeraya to buy gas from GSPL between now and 1 January 2006, in the event of any interruption to its existing gas supply.

For PowerSeraya, this means that it will have an alternative gas supply at similar cost should its current supplier be unable to supply the full quantity required in an event of an upstream maintenance or outage. This alternate gas supply will be delivered via a separate pipeline from its existing single source of natural gas and enhances the security and reliability of the supply of gas to PowerSeraya’s power generation facility on Jurong Island.

“We are very pleased to have sealed this side letter agreement with GSPL, as it means we can reduce our exposure to possible fuel price risk due to a shortage of gas supply,” explained Mr Neil McGregor, Managing Director of PowerSeraya. “We have always been sourcing for the best options, such as the one today, to improve the security of our gas supply and lower our cost of Generation. In turn, this translates into better pricing alternatives for our customers,” he added.

Commenting on this side letter agreement, Mr. Tan Chin Tung, Chief Executive Officer of GSPL said, “The fact that PowerSeraya has advanced their gas offtake confirms the importance of the Grissik-Singapore pipeline through which GSPL imports its natural gas in enhancing the reliability of natural gas supply to Singapore”.

PowerSeraya Ltd is one of Singapore’s major generation companies and supplies approximately 30% of Singapore’s energy needs. Since its corporatisation in 1995, PowerSeraya has strengthened its position as one of the leading energy suppliers though its adoption of energy efficient Combined Cycle Power Plants using more cost effective and innovative fuels.

Gas Supply Pte Ltd is the premier importer and supplier of natural gas from Sumatra through the 477 km Grissik- Singapore pipeline. The pipeline which was inaugurated in August 2003 by Prime Minister Goh Chok Tong and President Megawati has since been delivering South Sumatran natural gas to GSPL’s customers.

Jointly issued by PowerSeraya Ltd and Gas Supply Pte Ltd.