State oil firm Petronas said it will focus more on domestic operations but played down plans to further divest assets overseas.
Petronas officials today said the company would spend US$2 billion (RM6.2 billion) to develop 50-60 wells, with investment split equally between domestic and foreign projects over three years.
“We hope to rationalise and spend more on development than on exploration and bring that into the domestic side,” Petronas Group CEO Datuk Shamsul Azhar Abbas told reporters after presenting the the firm’s quarterly results.
“So when you talk about development and production, we are on the lookout for possible acquisitions.”
Shamsul’s comments come after the Fortune 100 company sold a five per cent stake in Australia’s liquefied natural gas project to France’s Total and media speculation it will divest its 14.5 per cent share in Cairn India Ltd, which is subject to a takeover offer from Vedanta Resources.
“We have not come to a decision on what to do with our Indian equity but we are not keen to leave the country,” said Shamsul who replaced hard-talking Tan Sri Hassan Merican in February.
Petronas will continue to focus on other overseas assets including the four wells in Iraq it is jointly developing with other oil majors and the Carabobo Project 1 in Venezuela.
Shamsul said the company had no plans of taking over a stake in Iran’s giant Azadegan oilfield project from Japan’s top oil explorer Inpex Corp, which may pull out to avoid US sanctions.
It said that it no longer had any involvement in the Iranian South Pars project as its contract had expired.
The oil firm posted a near 60 per cent jump in first quarter earnings to RM12.3 billion on recovering demand but warned that the uncertain global economy may curb future profits.
It was the first time Petronas has reported its results on a quarterly basis, as it seeks to increase its transparency.
The April-June results confirmed the refining turnaround was broadbased as profits from oil majors like Exxon-Mobil, ConocoPhillips and Royal Dutch Shell have also climbed.
“The healing from this slowdown will take longer than previous recessions,” Shamsul told reporters.
Petronas, which manages Malaysia’s energy reserves, said the country’s total oil and gas output rose 0.3 per cent 1.59 million barrels of oil equivalent per day in the April-June period from a year ago on higher demand.
But the company’s international oil and gas share fell slightly to 1.8 per cent to 279,000 barrels of oil equivalent per day due to expiry of service contracts. — Reuters
