First Reserve and Petrofac Sign Energy Infrastructure Agreement For US$1.25 Billion

 First Reserve and Petrofac Sign Energy Infrastructure Agreement For US$1.25
                                   Billion

- Petrofac and First Reserve to create PetroFirst Infrastructure Partners to
deploy capital both in purchasing a number of existing assets from Petrofac's
IES division, as well as in new energy infrastructure projects that utilise
Petrofac's development capability

- Agreement reinforces the positioning of IES as an enabler for the Petrofac
group, providing a route to market for its core areas of strength, offering
clear synergies with ECOM and reinforcing capital discipline

- Under the first transaction First Reserve intends to buy 80% of Petrofac's
deployed and contracted floating production facilities for a total initial
consideration of approximately US$450 million

PR Newswire

GREENWICH, Conn., HOUSTON, LONDON, and HONG KONG, June 26, 2014

GREENWICH, Conn., HOUSTON, LONDON, and HONG KONG, June 26, 2014 /PRNewswire/
-- Petrofac, the international service provider to the oil and gas industry,
has entered into a Framework Agreement (the 'Agreement') with First Reserve,
the global energy-focused infrastructure investment firm, to create PetroFirst
Infrastructure Partners. The new venture intends to deploy capital both in
purchasing a number of existing assets from Petrofac's Integrated Energy
Services (IES) division (commencing with the first transaction as described
below), as well as in new energy infrastructure projects that utilise
Petrofac's development capability.

The new venture is anticipated to be funded 80% by First Reserve and its
investors, with Petrofac retaining the balance of ownership. Up to US$1
billion is expected to be committed by the First Reserve Energy Infrastructure
Funds and its investors and Petrofac expects to contribute up to a maximum of
US$250 million in the form of existing assets and cash. The gross investment
capacity of the new venture is expected to be significantly increased through
debt leverage available to infrastructure investments.

Ayman Asfari, Petrofac Group Chief Executive, commented: "We are delighted to
have signed this agreement with First Reserve. As recently stated, we have
re-focused our IES business development plans and this innovative
venturereinforces the positioning of IES as an enabler for the Petrofac
group, allowing us to concentrate our resources on our core strengths
andunderlining our commitment to capital discipline. In addition to releasing
capital from our currently deployed assets, the agreement opens up future
opportunities to create value for our customers that require access to capital
alongside Petrofac's proven execution capability. We are seeing a clear shift
in the industry to contracted and shared infrastructure models and this
initiative will facilitate our ability to support our clients with this
offering."

Bill Macaulay, First Reserve Chairman and CEO, commented: "The creation of
PetroFirst Infrastructure Partners represents an exciting opportunity to
invest in energy infrastructure alongside a partner with a proven track record
for project execution. The Fund will benefit from an investment in long-term
contracted assets with strong support from Petrofac and its leading energy
sector customers. We look forward to working together with Petrofac on what we
expect will be a rewarding collaboration."

Initial transaction in floating production facilities
The first transaction ('the Transaction') under the Agreement will see
Petrofac and First Reserve establish a joint venture in respect of three of
Petrofac's deployed and contracted floating production facilities. Petrofac
has agreed to sell 80% of the share capital of Petrofac FPSO Holding Limited
to PetroFirst Infrastructure Holdings Limited, wholly owned by the First
Reserve Energy Infrastructure Fund I ('FREIF I'). Through its subsidiaries,
Petrofac FPSO Holding Limited owns interests in the FPSO Berantai, FPF3
(formerly Jasmine Venture) and FPF5 (formerly Ocean Legend)^(1).

The total initial consideration is expected to be approximately US$450
million, which comprises cash and the assumption by the joint venture of
around US$130 million of existing project finance in relation to the Berantai
FPSO^(2). The proceeds will be used for general corporate purposes. Petrofac
is entitled to a share of additional future cashflows upon renewal or
redeployment of the facilities at the end of their current deployment
contracts.

Prior to this transaction, Petrofac had expected to recognise net profit of
between US$50 million and US$60 million in the full year ending 31 December
2014 from the floating production facilities being sold. The Transaction is
expected to close by the end of the third quarter of 2014, subject to certain
conditions being met. Petrofac will report 100% of the earnings from the
floating production facilities up to the closing date and 20% of the earnings
of Petrofac FPSO Holding Limited thereafter. Following closure of the
transaction, PetroFirst Infrastructure Partners will have committed US$179
million of equity under the Agreement (FREIF I up to US$143 million; Petrofac
US$36 million), with up to US$1.1 billion of equity available for future
opportunities.

Petrofac FPSO Holding Limited will retain a put option, such that Petrofac may
be required to repurchase one or more of the facilities or their holding
companies for agreed aggregate consideration of between US$39 million and
US$105 million at the end of their deployment or at certain other key
junctures. Management believes that the repurchase consideration accurately
reflects the forecast residual values of the floating production facilities at
the times when the put options would vest.

Notes
(1) The assets being sold had a gross asset value of US$454 million at 31
December 2013.
(2)As noted on page 156 of Petrofac's 2013 Annual Report and Accounts, in May
2013, Berantai Floating Production Limited, a subsidiary of Petrofac FPSO
Holding Limited, entered into a senior secured term loan facility to refinance
the cost of obtaining and developing the Berantai FPSO.

Conference call
A conference call for analysts and investors will be held at 2pm today. The
participant details are as follows:

UK: 0808 237 0030
International: +44 203 139 4830
Passcode: 40431262#

A playback facility will be available as follows:

UK: 0808 237 0026
International: +44 203 426 2807
Passcode: 648833#

Notes to Editors
First Reserve
First Reserve is the largest global private equity and infrastructure
investment firm exclusively focused on energy. With over 30 years of industry
insight, investment expertise and operational excellence, the Firm has
cultivated an enduring network of global relationships and raised more than
US$26 billion of aggregate capital since inception. Putting these funds to
work, First Reserve has completed more than 475 transactions (including
platform investments and add-on acquisitions) across six continents. Its
portfolio companies operate in approximately 50 countries and span the energy
spectrum.

First Reserve Energy Infrastructure Fund is the infrastructure investment
business of First Reserve, which focuses on investing in contracted and
regulated energy assets.

For more information, please visit www.firstreserve.com.

Petrofac
Petrofac is a leading international service provider to the oil and gas
production and processing industry, with a diverse customer portfolio
including many of the world's leading integrated, independent and national oil
and gas companies. Petrofac is quoted on the London Stock Exchange (symbol:
PFC).

Petrofac designs and builds oil and gas facilities; operates, maintains and
manages facilities and trains personnel; enhances production; and, where it
can leverage its service capability, develops and co-invests in upstream and
infrastructure projects. Petrofac's range of services meets its customers'
needs across the full life cycle of oil and gas assets.

With more than 18,000 employees, Petrofac operates out of seven strategically
located operational centres, in Aberdeen, Sharjah, Abu Dhabi, Woking, Chennai,
Mumbai and Kuala Lumpur and has a further 24 offices worldwide.

For additional information, please refer to the Petrofac website at
www.petrofac.com.

SOURCE First Reserve

Website: http://www.firstreserve.com
Contact: Alison Flynn, Head of Media Relations, Petrofac,
Alison.flynn@petrofac.com, +44 (0) 20 7811 4913; Petrofac Investor Relations,
+44 (0)20 7811 4900, Jonathan Low, Jonathan Edwards, IR@petrofac.com; Tulchan
Communications Group Ltd, Stephen Malthouse, Martin Robinson,
petrofac@tulchangroup.com, +44 (0) 20 7353 4200; For further information for
First Reserve contact: Caroline Harris-Gibson, Prosek Partners, Tel:
212.279.3115 ext. 222, E-mail: cgibson@prosek.com; Julie Hamilton-Oakes,
Prosek Partners, Tel: 212.279.3115 ext. 234, E-mail: joakes@prosek.com
 
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