Largest Asian Deepwater FPSO Gets 6-Year Extension

Thailand's PTT Exploration & Production (PTTEP) has extended a charter contract for the FPSO Kikeh, which is operating off Sabah, Malaysia.

Malaysia International Shipping Corporation Berhad or MISC Berhad said that the extension was secured by the Malaysian Deepwater Floating Terminal (Kikeh) Limited (MDFT).

MDFT is a joint venture company between MISC and SBM Holdings. The two companies hold 51 and 49 percent of the equity, respectively.

According to MISC, the charter extension for the vessel is for six years, beginning in January 2022 until January 2028.

FPSO Kikeh is located in its namesake field, offshore Sabah, Malaysia. Built in 1974 and converted in 2007, the FPSO is the first and largest deepwater FPSO in Malaysia and Asia as well. The FPSO can produce 120,000 barrels of oil per day and has a storage capacity of two million oil barrels.

The Kikeh oil and gas field was also the first deepwater development in Malaysia. The FPSO is fed by wells drilled from a Spar dry tree unit.

Kikeh has a recoverable reserve base of over 400 to 700 million barrels of oil. The first oil from the field was achieved in August 2007 with a production ramp-up of 120,000 bpd. Project capital expenditures were projected at around $1.4 billion.

Murphy Oil was the operator of the field for over a decade but was taken over by PTTEP in 2019 as part of a larger transaction worth about $2.1 billion.

Apart from Kikeh, PTTEP acquired Murphy’s entire Malaysian business which included five petroleum exploration and production projects – the Sabah K project, the SK309 & SK311 project, the Sabah H project, the SK314A project, and the SK405B project.

In related company news, PTTEP and partner Petronas recently made a second gas discovery in Block SK417 from the Nangka-1 exploration well, located in shallow waters off the coast of Sarawak.

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