Gumusut-Kakap achieves first oil production
Published on: Tuesday, October 04, 2022
By: Bernama
Credit: en.wikipedia.org
Kuala Lumpur: Petroliam Nasional Bhd’s (Petronas) deepwater development project - Gumusut-Kakap (GK) Phase 3 - off the coast of Sabah, achieved its first oil production on July 31, 2022.“Sabah Shell Petroleum Co Ltd is the operator of the GK project, in partnership with Petronas Carigali Sdn Bhd, ConocoPhilips Sabah Ltd, PTT Exploration and Production Public Company Ltd, and PT Pertamina Malaysia Eksplorasi Produksi,” said the national oil company in a statement here Monday.
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Two new oil producer wells and two water injector wells were drilled.
Once fully completed in the first quarter of 2023, the four wells will add around 25,000 barrels per day to GK’s existing production capacity, it said.
“We are very proud of the tremendous efforts of our petroleum arrangement contractors including our service providers who, with the strong support of the Sabah state government, managed to overcome the challenges faced by the project, especially during the height of the pandemic.
“It is a real testament to the resilience of the local oil and gas ecosystem.
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“Whilst the shallow inboard areas continue to underpin the country’s production, the future lies in the deepwater plays which make up a quarter of our offshore acreages,” said Mohamed Firouz Asnan, Petronas senior vice-president of Malaysia Petroleum Management (MPM).
Petronas, through MPM, manages petroleum arrangements in Malaysia and provides stewardship of upstream petroleum activities.
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Meanwhile, MISC Bhd’s two liquefied natural gas (LNG) carrier charter contracts are expected to contribute between RM35 million to RM40 million in net profit from 2026 onwards, said RHB Research.
Previously, MISC announced that its subsidiaries, Polaris LNG Three Pte Ltd and Polaris LNG Four Pte Ltd, had secured long-term time charter contracts with SeaRiver Maritime LLC, a wholly-owned subsidiary of ExxonMobil, for two more LNG carriers.
The charters are expected to commence in 2026.
RHB Research said it is positive about the contract wins, as it will expand MISC’s current LNG fleet size of 30 vessels, and boost recurring income in the long term.
“Note that MISC had secured two 15-year charter contracts from Exxon Mobil, fetching an estimated combined contract value of US$711 million, back in 2019. These vessels are currently under construction in South Korea, and are slated for delivery in the first quarter of 2023 (1Q23).
“While there is limited disclosure on the contract details, we estimate the daily charter rate to range from US$80,000 to US$90,000 per day, which is lower than the average three-year charter of US$111,750 per day in August.
“Such rates are also higher than Exxon Mobil’s implied charter rate of US$65,000 per day, as the cost of building a new vessel had escalated by over 30 per cent to as high as US$240 million in August,” it said in a research note.Stay up-to-date by following Daily Express’s Telegram channel.
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