09:24 SOUTH SEA PETRO<00076>-Announcement&Resumption of Trading(3) are third parties independent of the Group and connected person of the Group (as defined under the Listing Rules). Production Contract: Contract Term: 30 years; from 12 December 2004 to 11 December 2034 Contract Area: Air Komering Block, an area consists of approximately 4,110 square kilometers located in Southern Sumatra, Indonesia. Estimated Energy Reserves within Contract Area: Approximately 250,000,000 barrels oil and 100,000,000,000 cubic feet gas (please be noted that the estimated data was furnished by the Department of Petroleum (BPMIGAS) of the Indonesian government to PT. Cahaya Batu Raja Blok for reference, and is yet validated, through exploration, by the technical team of the Company or a professional third party hired by the Company) REASONS FOR THE ACQUISITION The Production Contract is in line with the Company's corporate strategy to increase its investment in the energy-related industries and to actively seek investment opportunities in these industries. Considering the increasing demand in petroleum and the climbing oil price, while comparing the consideration of the Acquisition and the business potential offered by the Production Contract, the Board is of the view that the Acquisition is in the interest of Shareholders and the Company. Furthermore, the original 15-year oil exploration contract signed between the Company and Pertamina, a state-owned oil company of Indonesia, in Limau Oilfield, South Sumatra, Indonesia was expired on 31 December 2004. The Company has been negotiating with Pertamina for extension or signing of new contract for years, but the Company cannot guarantee it will be granted or when it will be granted in the near future. Therefore, the Board views that the Production Contract is a new opportunity for the Company. However, Shareholders and investors should always be cautious of the potential risk involved. GENERAL The principal activities of the Company are investment holding, and through its subsidiaries, the Company develops, explores and produces crude oil in Indonesia, and provides electronics manufacturing services in the United Kingdom. The Acquisition constitutes a discloseable transaction of the Company under the Listing Rule. A circular containing detailed information of the Acquisition will be dispatched to Shareholders as soon as practicable. The directors of the Company have noted the recent increase in the price and the trading volume of the shares of the Company and wish to state that they are not aware of any reasons for such unusual movements in price and trading volume save for the matters disclosed in this announcement. Save as disclosed above, the directors of the Company confirm that there are no negotiations or agreements relating to intended acquisitions or realizations which are discloseable under Rule 13.23 of the Listing Rules, neither is the Board aware of any matter discloseable under the general obligation imposed by Rule 13.09 of the Listing Rules, which may be of a price-sensitive nature. Made by the order of the Board of South Sea Petroleum Holdings Limited, the directors of which individually and jointly accept responsibility for the accuracy of this statement. Trading in the shares of the Company has been suspended at the request of the Company with effect from 2:30 p.m. on 7 April 2005 pending the release of this announcement. An application has been made to the Stock Exchange for resumption in trading of the shares with effect from 9:30 a.m. on 14 April 2005. DEFINITION "Acquisition" The acquisition of 65% interest of PT. Cahaya Batu Raja Blok for US$5,800,000 by Global Select Limited, the wholly owned subsidiary of the Company "Agreement" share purchase agreement entered into between Global Select Limited and the shareholders of PT. Cahaya Batu Raja Blok on 7 April 2005 to acquire 65% of the issued share capital of PT. Cahaya Batu Raja Blok "Company" South Sea Petroleum Holdings Limited, a company incorporated