Malaysia’s upstream sector is poised for additional development in 2024 as the federal government continues to advertise offshore blocks for exploration.
That’s what analysts at BMI, a Fitch Options firm, stated in a report despatched to Rigzone not too long ago, including that the upstream oil and fuel business in Malaysia “stays vibrant and continues to draw buyers or Petroleum Association Contractors (PACs), as highlighted by their participation in Malaysia’s earlier petroleum bidding rounds”.
The analysts said within the report that, in 2023, Malaysia made “vital progress within the upstream oil and fuel section as Petronas and PACs recorded 21 exploration discoveries and two exploration-appraisal successes”.
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“In response to Petronas, all new discoveries may contribute over one billion barrels of oil equal of recent assets for Malaysia in 2023,” the analysts added.
“Sixteen discoveries are positioned within the Balingian, West, and Central Luconia basins of Sarawak state, whereas three others are positioned in Sabah state,” they went on to state.
The analysts additionally famous within the report that the 2020 industrial settlement between Petronas and the Sarawak authorities over granting of a much bigger share of oil and fuel revenues produced within the state paved the way in which for an uptick in exploration actions in Sarawak state.
“In response to knowledge from the Malaysia Vitality Fee, Sarawak holds greater than 60 p.c of Malaysia’s whole pure fuel reserves and 40 p.c of whole crude oil reserves,” the analysts highlighted.
“New discoveries definitely boosted Malaysia’s efforts to reverse declining oil and fuel manufacturing and will assist its liquified pure fuel (LNG) manufacturing and exports,” they added.
Malaysia signed a complete of 9 manufacturing sharing contracts (PSCs) within the first quarter of 2024, BMI identified within the report.
Stranded Excessive-CO2 Fields
BMI analysts outlined within the report that stranded high-CO2 fuel fields at the moment are being focused for growth to assist Malaysia’s long-term pure fuel manufacturing targets.
“Malaysia is dwelling to numerous high-CO2 fuel fields, which stay undeveloped,” the analysts stated.
“The BIGST Found Useful resource Alternatives (DRO) Cluster, awarded to JX Nippon and Petronas, consists of 5 undeveloped high-CO2 fuel fields: Bujang, Inas, Guling, Sepat, and Tujoh,” they added.
The cluster is estimated to comprise 4 trillion cubic toes of fuel reserves, BMI highlighted.
“Petronas has reportedly improved fiscal phrases to incentivize investments in such advanced developments,” the analysts stated within the report.
“The event of the BIGST DRO cluster could possibly be accompanied by investments in carbon seize and storage (CCS) initiatives,” they added.
“Petronas and JX Nippon have already signed a Heads of Settlement to develop the fields and a CCS challenge, which is slated to turn out to be the second CCS challenge in Malaysia after the primary on the Kasawari area growth,” they continued.
The analysts additionally famous within the report that there are different “vital” high-CO2 fuel fields, “such because the K5 fuel area, which has a CO2 content material of 70 p.c”.
“The K5 fuel area found in 1970 is estimated to comprise 21 trillion cubic toes of fuel. Petronas allotted $1 billion for growth of the offshore Sarawak area regardless of TotalEnergies having exited from the challenge in 2014,” they added.
The BMI analysts said within the report that new oil and fuel discoveries are important to assist Malaysia’s long-term power safety. They highlighted that the nation has oil and fuel manufacturing targets of two million barrels of oil equal per day by 2025 and past.
Malaysia Oil, Fuel Output
In response to the Vitality Institute’s newest statistical evaluate of world power, Malaysia produced 82.4 billion cubic meters of pure fuel in 2022. This represented a 5.7 p.c yr on yr improve and a couple of.0 p.c of whole pure fuel manufacturing in 2022, the evaluate confirmed. From 2012 to 2022, Malaysia’s pure fuel manufacturing grew by a median of 1.8 p.c yearly.
Malaysia produced 502,000 barrels per day of crude oil and condensate in 2022, the evaluate revealed. That determine marked a 1.7 p.c yr on yr drop and 0.6 p.c of worldwide crude oil and condensate output in 2022, in accordance with the evaluate, which confirmed that, from 2012 to 2022, Malaysia’s crude oil and condensate manufacturing has dropped by a median of 1.7 p.c yearly.
The U.S. was the nation that produced essentially the most pure fuel (978.6 billion cubic meters) and crude oil and condensate (11.88 million barrels per day) in 2022, the EI’s evaluate revealed.
To contact the writer, e-mail andreas.exarheas@rigzone.com
