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Latest News
YTL Corp Unit To Pay US$5bil For 30% Stake In Enefit's Oil Shale Projects
News From : DagangHalal.com (12/15/2010)

KUALA LUMPUR: YTL Power International Bhd is investing in oil shale projects in Jordan with the acquisition of a 30% stake in Eesti Energia's Jordanian oil shale projects.

YTL would invest US$5bil to buy the 30% block in the Jordanian oil shale project, Bloomberg reported.

Eesti Energia and its Jordanian partner Near East Investment (NEI), together with YTL Power, will develop an oil plant with output of about 38,000 barrels per day.

Construction will commence following further analysis of the resource and environmental studies.

The plant will utilise Eesti Energia's leading proprietary oil recovery technology, which has more than 30 years of industrial production in Estonia.

As the new strategic partner, YTL Power would contribute its experience in developing and operating large energy production and trading assets in emerging markets, it said in a statement yesterday.

According to the new shareholding structure, Eesti Energia owns 65%, YTL Power 30% and NEI 5% of the oil shale projects in Jordan.

Eesti Energia is the national energy company of Estonia which is internationally known as Enefit while YTL Power is the utility subsidiary of YTL Corp Bhd.

We are delighted to have the opportunity to invest alongside Enefit, with its leading expertise in oil shale fired power generation and technology for oil recovery, said YTL Power executive director Datuk Yeoh Seok Hong.

Enefit chief executive officer Sandor Liive said YTL's presence would make a great contribution to the realisation of these projects which would put Jordan for the first time on the way to energy independence.

In May, Jordan Oil Shale Energy Company, a subsidiary of Eesti Energia, signed a concession agreement with Jordanian government for the mining of oil shale from Attarat um Ghudrun oil shale deposit in Jordan.

This was the first surface mining oil shale concession to be awarded by the Jordanian government, Bernama reported.

In another development, YTL Corp announced it is selling four of the company's hospitality properties to Starhill Global Real Estate Investment Trust (REIT) for RM472mil to be satisfied via a combination of cash and convertible preference units to be issued by Starhill REIT.

The properties to be sold include Cameron Highlands Resort, Hilton Niseko, Vistana Penang and Vistana Kuala Lumpur.

YTL Corp would then lease the properties from Starhill REIT for 15 years with an option to renew the lease agreements for a further 15 years.

YTL Corp in filing with Bursa Malaysia yesterday said the lease payments for the properties were fixed and included a 5% step-up rate every five years.

Furthermore, a YTL associate company, Business and Budget Hotels (Kuantan) Sdn Bhd, has also entered into a sale and purchase agreement with Starhill REIT to sell Vistana Kuantan for RM75mil to be satisfied via cash and issuance of new units in the latter.

Starhill REIT would then lease the hotel back to Business and Budget Hotels.

- The Star Online

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