Dateline 2020-12-08, Malaysian Reserve:
THE newly sealed commercial agreement between Sarawak state government and Petroliam Nasional Bhd (Petronas) would need to provide investment incentives for it to remain attractive for investors.
An industry expert said an agreement like that would have to create investment incentives as any increase in royalty amounts would discourage new investment in exploration and production.
“To have a successful agreement, part of it needs to ensure the right incentives are in place for investments in the state. Such an agreement may lead to higher investment costs, particularly in a low oil price environment, and cause lower investment and production in the coming years,” the expert, who asked for anonymity, told The Malaysian Reserve.