State-backed Petronas has awarded a production sharing contract (PSC) to a three-member partnership for its SB311 block, offshore Sabah.
In a statement emailed to Rigzone Thursday, the company revealed that the partnership consists of ConocoPhillips Sabah Gas, Shell Energy Asia and Petronas Carigali. Under the terms of the inked contract, ConocoPhillips will hold a participating interest of 40 percent in the block, while the other two partners will each hold a 30 percent stake.
The block, which spans over 410 square miles (1,064 square kilometers), is located in the central part of the Sabah Basin in water depths ranging from 164 feet to 328 feet (50 to 100 meters).
The partners plan to drill two wildcat wells, acquire 249 miles (400 kilometers) of 2D seismic data and re-process existing 3D seismic data on the block.
Malaysia holds Asia's third largest oil reserves, with most of its fields located offshore. But the country, like Indonesia, has been grappling with a decline in oil production as its established fields are maturing. As of last year, Malaysia's daily oil production stood at 630,000 barrels, well below the country's peak oil production in 2004 when it produced 860,000 barrels of oil per day.
The country's government has vowed this year to plough investment dollars into enhancing oil recovery in its mature assets, as well as develop gas recovery in its offshore fields.
Petronas inked a PSC with Shell Malaysia Nov. 27 to explore for oil and gas on Block SK319, also offshore Sarawak.
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