Mubadala, Petronas and Shell to spend over US$1b on Pegaga gas field offshore Sarawak

KUALA LUMPUR: Mubadala Petroleum, Petroliam Nasional Bhd (Petronas) and Royal Dutch Shell will spend more than US$1 billion (RM3.9 billion) to develop Malaysia’s Pegaga gas field, aiming to produce gas by the third quarter of 2021, Abu Dhabi-based Mubadala said today, Reuters reported.
The project in Block SK320, located in the Central Luconia province, offshore Sarawak, will now proceed to the construction and installation stage, the company said in a statement.
Mubadala is the operator of the block with a 55% while Petronas Carigali holds a 25% interest and Sarawak Shell holds 20%.
The Pegaga gas field would be the first development in Malaysia for Mubadala Petroleum, which is fully owned by Abu Dhabi-based state fund Mubadala Investment Co that holds assets worth over US$125 billion.
The company plans to build an Integrated Central Processing Platform consisting of an eight-legged jacket designed for natural gas throughput of 550 million cubic feet per day plus condensate to be located in water depths of about 108 metres, Mubadala said.
The production will be sent through a new 38-inch subsea pipeline tying in to an existing offshore network and subsequently to the onshore Malaysia LNG plant in Bintulu, the company said.
Separately, Sapura Energy Bhd, Malaysia’s largest oil and gas services company, said it won the contract from Mubadala Petroleum to undertake the engineering, procurement, construction, installation and commissioning works for the Pegaga gas field.
Sapura has won contracts worth nearly RM3 billion so far this year, including the Pegaga gas field, it said in a statement yesterday. Sapura had already announced contracts worth RM905 million before this.
Sapura expects the contract to contribute positively towards its earnings for the financial year ending Jan 31, 2019 and the financial periods thereafter within the duration of the contract.
On Bursa Malaysia today, closed up 3 sen or 6.2% at 51.5 sen on volume of 160.87 million shares.