Fleet expansion with two new premium jack-up drilling rigs totalling US$434 million 

KUALA LUMPUR, 12 FEBRUARY 2014 – UMW OIL & GAS CORPORATION BERHAD ("UMW-OG") is living up to its promise of expanding its fleet with the purchase of two more jack-up drilling rigs for a total purchase consideration of US$434 million from Tianjin Haiheng Shipbuilding & Offshore Engineering Service Co., Ltd ("Tianjin Haiheng").

In an announcement released today, UMW-OG revealed that UMW Drilling 6 (L) Ltd ("UD 6"), a wholly-owned subsidiary of UMW Rig Asset (L) Ltd ("UMW Rig Asset"), which in turn is a wholly-owned subsidiary of the Company, has entered into a Sale and Purchase Agreement with Tianjin Haiheng for the purchase of both rigs.

Both rigs are currently under construction at China Merchants Heavy Industry dockyard in Shenzhen, China. Delivery of the first rig, Hull No. CMHI 128-1 is expected in September 2014 while the second rig, Hull No. CMHI 128-2 will arrive three months later. Both the new premium jack-up drilling rigs are of the same specifications as two of UMW-OG's existing rigs, UMW NAGA 2 and UMW NAGA 3, with an extra ability to drill in deeper water. The new rigs will be named UMW NAGA 6 and UMW NAGA 7 respectively. Proceeds raised from the recent initial public offering ("IPO") will be used to partially fund the purchase while the remaining funding will be via bank borrowings.

UMW-OG President Rohaizad Darus commented, "These acquisitions are in line with our vision to further expand into the broader Asia-Pacific region as part of our plan to be a global player. This will allow us to capitalise on favourable industry conditions with our enlarged asset capacity. We will also be more efficient in our operation and maintenance due to common equipment and spare parts since we have four of similar specifications rigs in our fleet."

The Company currently has one semi-submersible and three jack-up drilling rigs and four hydraulic workover units under its drilling services business, which are currently servicing Malaysia and South-east Asia. With this acquisition and the recent construction contract awarded to Keppel FELS, the Company will own a total of seven jack-up drilling rigs. In addition, the Company will also add one more hydraulic workover unit this year with the recent purchase of a new advance hydraulic workover unit from Canadian Energy Equipment Manufacturing FZE. UMW-OG also has an oilfield services business which provides threading, inspection and repair services for Oil Country Tubular Goods ("OCTG") in Malaysia and overseas.