KS Energy Provides Pulling Unit to Petronas

KS Energy Services has established a joint venture with BR Energy Sdn Bhd to provide a workover pulling unit to Petronas Carigalito support Petronas' offshore operations. The charter income of up to approximately US$30.7 million covers a period of 5 years, comprising an initial tenure of 2 years and 3 renewable one-year terms.

The workover rig will be deployed to provide workover services for offshore operations in Malaysia.

KS Energy's US$0.5 million investment in the JV Company will be funded by internal resources. KS Energy will procure a workover rig for the JV Company and the delivery of the unit is expected by mid-2006. At the end of the Contract term, the JV Company will be able to re-deploy the workover rig for other operations.

This Project reinforces KS Energy's leading position as an integrated provider of capital equipment, parts and services to the buoyant global oil & gas industry. With demand for a wide spectrum of offshore equipment and services remaining strong, KS Energy is well positioned to continue benefiting from the growth of the global oil & gas industry.

The Project is not expected to have a material impact on the Group's earnings per share or net tangible assets for the financial year ending December 31, 2006.

None of the Directors or substantial shareholders of KS Energy has any interest, directly or indirectly, in the above transaction.