SEA Hibiscus has signed a US$25 million deal with Shell to acquire operatorship and 50% stake in four fields in the 2011 North Sabah Enhanced Oil Recovery production sharing contract (PSC), offshore Sabah, Malaysia.
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Malaysia operations. Image from Shell Flickr. |
The deal, between the Hibiscus Petroleum Berhad’s indirect wholly-owned subsidiary, and Sabah Shell Petroleum Co. with Shell Sabah Selatan Sdn Bhd, comprises of four producing oil fields and associated infrastructure that includes St Joseph, South Furious, SF30, and Barton oilfields.
The PSC also contains pipeline infrastructure and the Labuan Crude Oil Terminal. Total oil production (on a 100% PSC basis) averaged approximately 18,000 b/d in 2015.
Currently, Sabah Shell Petroleum Co. (25%) is the operator, partnering with Shell Sabah Selatan (25%) and Petronas Carigali Sdn Bhd (50%) in PSC.
The acquisition is expected to be complete in 2017 and is subject primarily to obtaining regulatory approval of Petroliam Nasional Berhad (Petronas), and consent of Petronas Carigali, a 50% joint venture partner in the PSC.The PSC provides long-term production rights until 2040 with identified future development opportunities.
This transaction is part of Shell’s review of its upstream portfolio, to focus on acreage positions that hold or can reach the scale required by Shell, Shell said.
“Malaysia continues to be an important country for Shell,” the supermajor confirmed. “Shell’s Sabah portfolio is contributing significantly to Malaysia’s economy through deepwater projects like Gumusut-Kakap and Malikai.”
“This acquisition is in line with the growth strategy of the group to invest in profitable development and producing business operations in our identified core geographical areas of interest," Dr. Kenneth Pereira, managing director of Hibiscus Petroleum said. "When we created Hibiscus Petroleum, this was our goal, to invest in Malaysia and to apply our knowledge and experience to create value in our own backyard.”
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