Petronas Farms Down Several Malaysian Assets

Petroliam Nasional Bhd (Petronas) has signed several agreements to bring in new partners in producing upstream assets in Peninsular Malaysia and Sarawak state.

"EnQuest Petroleum Production Malaysia Ltd is to assume operatorship and participating interests (PI) in the Balingian PSC, SK8 PSC and D35 PSC, while also participating as a non-operating partner in the PM6/12 PSC", Malaysia's national oil and gas company Petronas said in a press release.

"A key component of one of these agreements is the participation of Terengganu's TI Exploration & Production Sdn Bhd (TI EP), which will hold a non-operated PI in the PM6/12 PSC", Petronas added. TI EP is a joint venture of TI Petroleum Sdn Bhd, part of Terengganu state's sovereign investment company Terengganu Inc, and Ping Petroleum Ltd.

"The participation reflects Petronas' continued efforts to facilitate state involvement in Malaysia's upstream industry, enabling state-linked entities to build capabilities and participate meaningfully in the development of the nation's petroleum resources", Petronas said.

Petronas upstream chief executive Mohd Jukris Abdul Wahab said, "As these assets mature, it is important that they continue to be supported by the right partnerships to sustain value creation responsibly and over the long term. This includes creating opportunities for state participation, while bringing in partners with complementary capabilities and relevant operating experience. This approach will position us to attract continued investment, strengthen industry capabilities, and support Malaysia’s energy security, while ensuring these assets continue to deliver value for the nation".

Earlier Petronas brought in Italy's state-backed Eni SpA as a partner in several assets in Malaysia, as well as in neighboring Indonesia.

The companies completed the formation of a 50:50 joint venture combining their gas-focused assets in the two countries. "With a portfolio of 19 gas-producing and development assets - 14 in Indonesia and 5 in Malaysia, Searah will start from an initial production base in excess of 300,000 boe/d [barrels of oil equivalent a day], aiming to exceed 500,000 boe/d of sustainable production within the next three years", Eni said in an online statement June 8.

"A $6 billion Revolving Credit Facility has been successfully secured, reflecting the strong confidence of the financial markets to fund Searah’s growth plans, which include a pipeline of expected investment for over $20 billion over the next five years", Eni added.

"These investments will support the development of more than 3 billion barrels of oil equivalent (boe) of discovered resources and unlock multi-billion boe of additional exploration potential".

Petronas CEO Muhammad Taufik said, "The establishment of Searah aligns with Petronas' intensified focus on exercising greater discipline in developing resources coupled with more agile capital deployment as well as stronger emphasis on sustained value creation across the gas value chain".

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