KUALA LUMPUR (Aug 30): Petroliam Nasional Bhd (Petronas) has inked two new small field asset (SFA) production sharing contracts (PSCs) with Rex International Holding Ltd and Duta Marine Sdn Bhd for the Rhu-Ara and Diwangsa clusters offshore Peninsular Malaysia.
The national oil company said the award of these PSCs marked Rex International's maiden entry into Malaysia's upstream industry, in partnership with local company Duta Marine.
It said Rex International, which held 95% participating interest with Duta Marine holding the remaining 5% in both PSCs, brought to the table significant operating experience and expertise in developing and producing small oil fields in the Middle East as well as participation in joint ventures in the North Sea.
Petronas said these fields were offered during the Malaysia Bid Round 2020 based on the SFA fiscal terms introduced in the same year that intensified Petronas' commitment to monetising small discovered resource opportunities in Malaysian waters.
It said the Rhu-Ara cluster, consisting of Rhu and Ara fields, lies within the Penyu Basin, 150km off the coast of oil centre Kerteh, Terengganu while the Diwangsa cluster, which lies in the north-western side of the Malay Basin, comprises Diwangsa, Bubu, Korbu, and Lerek fields.
"These previously discovered fields have total estimated recoverable of 12.7 Million Stock Tank Barrels (MMstb) for the Rhu-Ara cluster and 10.7 MMstb for the Diwangsa cluster.
"Both clusters are now primed for development under the SFA PSC terms which incorporate a simplified fiscal model and governance process," it said.
Malaysia Petroleum Management senior vice president Mohamed Firouz Asnan said Petronas believes that Rex International's proven capability in developing small fields abroad could be deployed in the Rhu-Ara fields to unlock the potential in the Penyu Basin followed by the development of the Diwangsa cluster.
"We welcome new players who can deliver innovative solutions to ensure the lowest total life cycle cost in developing the discovered resources opportunities available in Malaysian waters.
"We are pleased to see that the SFA terms have become more attractive to the investors, thus validating the efforts taken to turn Malaysia into a growth hub for the investors," he added.