Interra ties up with Chinese MNC Sany to invest in South-east Asia oil and gas
Singapore
OIL and gas exploration and production firm Interra Resources is collaborating with Chinese multinational heavy equipment firm Sany Heavy Industry to invest in the oil and gas industry in South-east Asia, as part of the latter's focus on securing China's energy needs.
Interra Resources on Monday entered into a memorandum of understanding with Sany South East Asia, a wholly owned subsidiary of the Hong Kong and Shanghai-listed group.
Both plan to invest and develop companies and assets related to the oil and gas industry in South-east Asia.
Sany stands to gain through the MOU with plans to cooperate together or to set up a joint venture to market, sell or lease Sany's equipment to the industry. Interra, on the other hand, could enjoy an injection of funds from Sany into its exploration and production operations in South-east Asia.
Both will also explore the possibility of acquiring suitable companies that will help achieve the stated objectives in the MOU, Interra said in a press release.
The agreement is part of China's One Belt, One Road initiative which seeks to improve connectivity via the ancient silk road connecting China with Europe and a new sea route that passes through South-east Asia, Africa and the Middle East.
Energy is a key sector under the initiative. China plans to invest in projects ranging from upstream exploration to oil and gas pipelines and liquefied natural gas terminals as well as renewable energy.
"The strategic cooperation between Interra and Sany is aimed at establishing a win-win partnership with Singapore as a strategic hub for business development between China and Asean," Interra Resources said in the statement.
In an interview with Chinese news agency Xinhua in April this year, Sany's president Xiang Wenbo said that about 70-80 per cent of the group's market is in countries along the One Belt, One Road route. Overseas sales contributed to a third of the group's revenue last year.
Shares for Interra Resources closed unchanged at 9.2 Singapore cents on Monday before the announcement.
