Thursday, 27 February 2014

Oil majors still active in M'sia

International oil companies (IOCs) continue to be active in Malaysia despite the recent exit of Newfield Exploration Co and a proposed sale by Murphy Oil Corp, according to Petroliam Nasional Bhd (Petronas) executive vice-president (exploration and production business) Datuk Wee Yiaw Hin.

“There are about 100 active production-sharing contracts (PSCs) in the country today from 70 or 80 in the past.

“The fact that Newfield is leaving does not change the number of PSCs that are active. They were basically farming out (their assets) to another party.

“Newfield made a business decision because of shareholder activism and to concentrate on their home business. It does not mean the PSCs are any less active.

“You will find that as oil fields mature, the players will change, and it is healthy to change,” he told reporters at the launch of Offshore Technology Conference Asia 2014 (OTC Asia) yesterday.

He added that any sale by foreign oil exploration companies in Malaysia was not prompted by any internal policy changes on Petronas’ part.

“If anything, we have embraced PSCs. That’s how we got to more than 30 PSC operators.

“We are also running out of what we call ‘white space’ to award to IOCs,” he said, referring to the management term for unexplored opportunities.

StarBiz had reported last week that Murphy was looking to hive off a 30% stake in its oil and gas (O&G) assets here at a price tag of US$2bil to US$3bil (RM6.62bil to RM9.93bil), following Newfield’s US$898mil (RM2.97bil) sale to SapuraKencana Petroleum Bhd last year.

Several parties had reportedly expressed interest in Murphy’s offer.

Murphy, which was set up here in 1999, has majority interests in five separate PSCs – Block K, Block H, Block SK309, Block SK311 and SK314, as well as three gas holding agreements in Block PM311.

On OTC Asia, which will be held in Kuala Lumpur for the first time in its four-decade history from March 25 to March 28,

Wee said: “The fact that Malaysia was chosen to host the inaugural OTC Asia speaks volumes about the country’s progressive O&G industry, with Petronas at the forefront of these development efforts.”

Petronas is the corporate supporting organisation for the first OTC Asia 2014.

According to Wee, the Asian region is seen making up 80% of the world’s energy demand growth over the next decade.

“And we will need to find solutions to meet this demand. At the same time, the age of easy oil is over. Between 2010 and 2030, global demand for energy is set to grow 30%, and double by 2050 from now. The centre of this growth is Asia.”

More than 200 exhibitors will participate in OTC Asia, 30% of them Malaysian.

Participating oil majors include Aker Solutions, Baker Hughes, ConocoPhillips, Gazprom, Halliburton, Shell, Subsea 7, WestStar Aviation, Technip, Pemex, PTT Exploration and Production Company and Weatherford.

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