KOTA KINABALU: The Sabah state government, through its wholly owned entity SMJ Energy Sdn Bhd, continues its expansion in the oil and gas sector with the signing of two key agreements for exploration blocks SB306A and SB306B located offshore of the state’s east coast.
With the agreements, SMJ Energy has secured a 15% participating right in both blocks, comprising a 7.5% free carry right from Japan’s Inpex and a 7.5% back-in right from PETRONAS Carigali Sdn Bhd (PCSB).
Under this arrangement, SMJ Energy assumes no exploration risks and retains the option to exercise its participation rights based on exploration success and other commercial considerations.
SB306A is operated by Inpex, which holds a 50% participating interest (PI), while PCSB holds 42.5% PI and SMJ Energy 7.5% PI. In SB306B, PCSB is the operator with a 50% PI, Inpex holds 42.5% PI, and SMJ Energy maintains a 7.5% PI.
The agreements were signed at the Malaysia Bidding Round 2024 award signing ceremony held in Kuala Lumpur on Feb 17.
SMJ Energy CEO Dr Dionysia Kibat signed the production sharing contracts alongside representatives from Petroliam Nasional Bhd (PETRONAS), PCSB, and Inpex.
The move marked another significant milestone for SMJ Energy, which has steadily expanded its footprint in Sabah’s oil and gas industry.
The company’s first back-in right was signed on Feb 15, 2023, for exploration block SB409, followed by another on Jan 23, 2024, for exploration block SB403, both situated offshore Sabah’s west coast.
