(EnergyAsia, June 2 2011, Thursday) — Loyz Oil Pte Ltd, the oil and gas exploration and production (E&P) arm of Singapore’s Sim Siang Choon Limited, said it is raising S$12 million via a redeemable exchangeable preference share issue to fund its push into the upstream energy sector. (US$1=S$1.25).
Under the subscription agreement with Loyz Oil and SSC, two Singapore-incorporated private equity funds, Venstar Investments Ltd and Venstar Investments II Ltd, have agreed to take up the entire $12 million preference share issue, half of which are convertible into 15 million new SSC shares at an exchange price of S$0.40 per SSC share after a 12-month period. The remaining half can also be converted into new SSC shares at the same price after a further 12 months.

The preference shares may also be redeemed at S$0.25 per share should the Venstar funds decide not to convert them into SSC shares. The two funds are managed by Venstar Capital Mgt Pte Ltd.

Loyz Oil said its proposed issue of redeemable exchangeable preference shares is subject to shareholders’ approval at an extraordinary general meeting which SSC will convene at a later date.

In March, Loyz Oil said it gained access to proprietary evaluation and processing technologies under a proposed co-operation with Rex Oil & Gas Limited.

After discovering oil in its first well in its Baola field, SSC’s 51.8%-owned Interlink Petroleum Limited (IPL) reported that it had started drilling an appraisal well in its Modhera field in April. The Bombay Stock Exchange-listed IPL holds a 100% interest in concessions for two fields, Baola and Modhera, in Gujarat, India.

Adrian Lee, SSC’s newly appointed executive director, said:

“We believe hydrocarbons remain one of the most viable and efficient source of energy. Depleting world reserves have driven governments to encourage investments and work in marginal fields. We will develop Loyz Oil into a niche player based on proprietary technologies in the upstream E&P segment.

“We are exploring various concessions to grow our E&P portfolio. These may include marginal fields that have become economically viable in the Asia Pacific region and the S$12 million raised will help fund good M&A opportunities.”

Sim Siang Choon Ltd, 35.2%-owned by Jit Sun Investments Pte Ltd, is positioning to become an oil and gas exploration and production (E&P) company in the Asia-Pacific region.