SAAG Consolidated (M) Bhd ("SAAG" or "the Company") - TPS Builders Limited, a subsidiary of the Company has received two (2) letters of intent from Chennai Petroleum Corporation Limited 1. Introduction The Board of Directors of SAAG is pleased to announce that TPS Builders Limited (“TPS”), a subsidiary of the Company has received further shutdown contracts as follows from Chennai Petroleum Corporation Limited:- i) a Letter of Intent dated 4 June 2012 for Crude Distillation Unit (Plant-15) shutdown (2012) works at Manli Refinery of CPCL (“Contract 1”) at a contract value of Rs.8,886,552.40 (approximately RM508,000); and ii) a Letter of Intent dated 4 June 2012 for Piping, Structural and Flare Maintenance jobs in Offsite Maintenance during Refinery II Shutdown, 2012 at CPCL - Manali (“Contract 2”) at a contract value of Rs.6,230,110/- (approximately RM356,000). (Contract 1 and Contract 2 are collectively referred to as “Contracts”) Contract 1 and 2 are subject to mobilization/shut down date confirmation and the Company is pleased to announce that TPS has on 13 July 2012 mobilized the abovementioned contracts. 2. Details of the Contracts Contract 1 Contract 1 duration shall be for Forty (40) days from the date of issue of first work permit issued during the shutdown till completion of de-blinding activity and as per the details given in time schedule of the tender document. Contract 1 is not renewable. The Crude Distillation Unit (“CDU”) is the first processing unit in virtually all petroleum refineries. The CDU distills the incoming crude oil into various fractions of different boiling ranges, each of which are then processed further in the other refinery processing units. The CDU is often referred to as the atmospheric distillation unit because it operates at slightly above atmospheric pressure. Contract 2 Contract 2 is for duration of Thirty Seven (37) engineering days reckoned from the date of intimation by the Engineer-in-charge. Contract 2 is not renewable. Flare stack, is a gas combustion device used in industrial plants such as petroleum refineries, chemical plants, natural gas processing to - for burning off flammable gas released by pressure relief valves during unplanned over-pressuring of plant equipment. During plant or partial plant startups and shutdowns, flare stacks are also often used for the planned combustion of gases over relatively short periods. 3. Risk Factors The Contracts are subject to risks inherent in the Oil Refining industry. These include shortage of skilled personnel, timely release of work fronts, penalties for delay in execution, the changes to the general economic, business and political conditions such as, labour shortages, levies, duties, taxes, and availability of bank loans. Any adverse change in one or more of these factors could materially affect the financial and business prospects of SAAG Group. 4. Financial Effects 4.1 Share capital The Contracts will not have any material effect on the Company’s issued and paid-up share capital. 4.2 Net Assets The Contracts will not have a material effect on the Company’s net assets per share and gearing for the financial year ending 31 December 2012. 4.3 Earnings The Contracts are expected to contribute positively to the earnings of SAAG Group in the year 2012. 5. Directors’ and Major Shareholders’ Interest None of the Directors and/or persons connected with them has any interest, direct or indirect, in the Contracts. The Company does not have any major shareholders as at the date of the announcement. 6. Statement by the Board of Directors The Board of Directors of SAAG is of the opinion that the award of the Contracts is in the best interest of the SAAG Group. This announcement is dated 16 July 2012.
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