Petronas Awards New Production Sharing Contract TO Talisman Malaysia and Petronas Carigali

PETRONAS has signed a new Production Sharing Contract (PSC) with Talisman Malaysia Ltd and PETRONAS Carigali Sdn Bhd for the continuing production, further development and improved recovery of crude oil from the Kinabalu Fields, a number of fields with matured reservoirs located offshore Sabah, East Malaysia.

The PSC is the first awarded under the new, innovative Progressive Volume-Based (PVB) fiscal terms designed by PETRONAS to offer value-added incentives for the development and production of matured oil fields in Malaysia. In particular, the PVB terms provide progressive profit sharing to provide incentive to contractors to improve oil recovery and increase production as the risks of developing and producing from matured fields become progressively higher over the lifetime of the field.

Under the terms of the PSC, both Talisman Malaysia and PETRONAS Carigali are committed to investing over US$1 billion towards various activities in the contract area, including achieving early production gains, improving operational efficiency and addressing subsurface issues. Additionally, the two partners are also to focus on field redevelopment efforts with a view to realising improved oil recovery potential as well as committing to an enhanced oil recovery pilot initiative.

Talisman Malaysia will be the operator of the PSC area with a 60% participating interest and is expected to leverage on its experience and expertise in operating matured fieldsworldwide.
The PSC was signed on 23 May in Kuala Lumpur. PETRONAS was represented by Encik Ramlan Abdul Malek, Vice President of Petroleum Management. Mr. Ron Aston, Vice President and Country Manager of Talisman Malaysia and Datuk Abdullah Karim, President of PETRONAS Carigali, signed on behalf of their respective companies.

Source: Petronas