KUALA LUMPUR: Straits Energy Resources Bhd's sub-subsidiary SMF Beluga Ltd has entered into a bareboat charter hire agreement with Adamas Marine Sdn Bhd to acquire a vessel for US$3.5mil (RM14.55mil) cash.

       In a filing with Bursa Malaysia, the group said the purchase consideration of the oil tanker named MT Empower will be satisfied over a period of three years.

       It added that its board of directors deemed the purchase consideration of US$3.5mil reasonable as it represents a discount of about 12.5% over the market value of US$4mil as ascribed by the independent registered valuer.

       The vessel is expected to be delivered by the vendor between Oct 1, 2021 to Nov 30, 2021.

       "The Proposed Acquisition enables Beluga to own a vessel, named Empower to expand the business of SMF especially in the supply of Low Sulphur Fuel Oil Market to cater the increasing demand of LSFO in Malaysia.

       "The addition of Empower will enlarge the asset base of Straits and its subsidiary companies and would provide the Group with added flexibility in respect of its allocation and utilization of vessels in undertaking its business activities," said the group.

       Beluga is wholly owned by Straits Marine Fuels & Energy Sdn Bhd, which is in turn 67%-owned by Straits Energy Resources.