Petronas signs sharing agreement with Indonesia and Vietnam

Petronas Bhd has yesterday signed a production sharing contract (PSC) with Indonesia’s Pertamina and PetroVietnam to jointly explore and develop hydrocarbon resources in Block SK305, offshore Sarawak. 

The signing has further enhanced the alliance under the Tripartite Cooperation Arrangement between the three Asean national oil companies, Petronas said in a statement. 

Under the terms of the PSC, the three parties have formed a joint venture company, PCPP Joint Operating Company (PCPP), to operate the block. 

Petronas Carigali Sdn Bhd, a wholly-owned exploration and production subsidiary of Petronas, has a 40% equity in PCPP, while Pertamina and PetroVietnam Investment & Development Company (PIDC), which is a unit of PetroVietnam, have a 30% stake each. 

Block SK305 is located in water depth of 150 metres in Balingian, offshore Sarawak, covering an area of about 15,164 sq kilometres.  

The block was previously operated by Shell until 1999, the statement said. 

Under the PSC, the operators are required to drill two firm and two optional exploration wells as well as acquire and process new 2D and 3D seismic data on the block, Petronas said. 

The minimum financial commitment for the block was RM39mil, Petronas said. 

According to the statement, the signing of the PSC for Block SK305 signifies another step towards fostering a more meaningful and mutually beneficial partnership between Petronas, PetroVietnam and Pertamina. 

In January last year, the three companies were awarded two offshore exploration blocks in Vietnam, namely Blocks 10 and 11.1, operated by Con Son Joint Operating Company whose equity holders are PIDC (40%), Pertamina (30%) and Petronas Carigali Overseas Sdn Bhd (30%). 

The Tripartite Cooperation Arrangement will also facilitate the transfer and exchange of knowledge and technology between the three partners. 

It was set to pave the way for more joint cooperationin petroleum exploration and production activities between the three companies, Petronas said.  

After having secured exploration blocks in Vietnam and Malaysia, the three parties are now undertaking joint evaluation of acreages in Indonesia and expect to conclude a similar contract in the near future. - Bernama