Response To Articles On Cost Overruns In Maersk Oil Qatar Oil & Gas Project

Press Release

18 April 2008 – Over the past few days, a few media organisations have reported that Sime Darby Engineering has incurred cost overruns of between RM120 million and RM150 million in its offshore engineering, procurement, construction, installation and commissioning project for Maersk Oil Qatar (MOQ).

These reports are inaccurate.

Sime Darby Engineering, a wholly-owned unit of Sime Darby Berhad, would like to state that there are no cost overruns with regard to its on-going project with Maersk Oil Qatar.

Work on the project is ahead of schedule and is being carried out within contracted terms. Maersk Oil awarded Sime Darby Engineering the EPCIC contract to build and install a process platform, a utility platform and three bridges off the coast of Qatar in February last year.

With regard to all projects, Sime Darby Engineering has been tracking the global trend of rising prices of commodities and raw materials. And it has made provisions for higher cost of raw materials such as steel in the all these projects. This was done in the interest of best practices of prudent accounting.

Thus, Sime Darby Engineering does not foresee the need for any further provisions in this financial year.

Given the present scenario, Sime Darby Berhad does not anticipate any impact to the group results for the financial year ended June 30, 2008.