As a result, Sembcorp Gas (SembGas) will receive compensation from the relevant parties as follows: the net book value of the assets with a 40-year depreciation period estimated at approximately SGD90 million as of September 15, 2008 from PowerGas; other compensation of SGD35 million from the government of Singapore; and a remission from the Inland Revenue Authority of Singapore of any tax payable on the compensation to be received by SembGas.
SembGas said that it will thus recognize a one-off gain of approximately SGD25 million in its financial results for 2008. It is estimated that there will be a negative impact of approximately SGD3.6 million per annum to SembGas’s after-tax profits for subsequent years until 2023. SembGas is a 70%-owned indirect subsidiary of Sembcorp Industries.
