Sarawak Shell’s Gorek field delivers its first gas production ahead of schedule

September 15, 2020

Dateline 2020-07-31, NST:

Sarawak Shell Bhd (SSB), through its Gorek field under the SK408 Production Sharing Contract (PSC) has achieved its first gas production on May 24, 2020.

SSB said the first gas was delivered ahead of the committed timeline, despite the significant impact to the mobilisation of resources and construction and commissioning crew during the Movement Control Order (MCO) due to the Covid-19 pandemic.

“This success is a result of the excellent collaboration between our key stakeholders, Petronas and SK408 PSC partners – SapuraOMV Upstream and Petronas Carigali Sdn Bhd, contractors, vendors and various support teams within Shell, led by the Gorek project team.

“This achievement commemorates the 110th anniversary of our Upstream business, here in Malaysia this year,” said Shell Malaysia Upstream vice president Ivan Tan.

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Petronas slate change prompts off-specification bitumen

September 14, 2020

Dateline 2020-07-24, Argus Media:

Malaysia’s state-owned Petronas has started to run more lighter crude at its 270,000 b/d Malacca refinery since mid-July, resulting in an increase in off-specification bitumen supplies.

Malacca typically blends Saudi Arabian crude with fuel oil to produce pen 60/70 bitumen. It has raised the amount of light sweet crude it uses, together with its typical medium sour crude slate, to take advantage of more attractive prices for lighter grades. This has resulted in the refinery producing off-specification bitumen stocks of grade pen 80/100 instead of pen 60/70.

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Petronas eyes growth in local RE business

September 13, 2020

I’m pretty sure there is a sales tax on that.

Dateline 2020-07-21, The Malaysian Reserve:

PETROLIAM Nasional Bhd’s (Petronas) new energy business unit foresees growth in the local renewable energy (RE) market through NE Suria Satu Sdn Bhd (NESS), a joint-venture company between Petronas and NEFIN Group.

With Tesco Stores (Malaysia) Sdn Bhd as its first commercial customer, NESS will be providing a solar rooftop solution covering design, installation, operation and maintenance of solar photovoltaic (PV) panels for selected Tesco stores nationwide.

The provision of the solar rooftop solution is now ongoing until 2040, after the signing of a 20-year power purchase agreement (PPA) between NESS and Tesco, the largest commercial solar PPA of its kind in Malaysia.

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East Malaysia still key O&G node for Shell

September 12, 2020

Dateline 2020-07-18, Borneo Post:

Sabah and Sarawak remain key to Shell Malaysia’s operations since its inception in Miri in 1910. As the oil and gas group celebrates its 110 years in upstream this year, Shell vice president for Malaysia and Philippines Ivan Tan spoke to The Borneo Post on Shell’s enriching journey to date.

“Shell has come a long way since the successful discovery of the nation’s first oil on Canada Hill, Miri, on August 10 in 1910. The momentous oil discovery in Miri started the influx of a skilled workforce and turned Miri into a bustling town,” he said in an exclusive interview.

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No lawsuit, but Petronas must pay what is owed to Sabah

September 11, 2020

Dateline 2020-007-16, The Malaysian Reserve:

SABAH state government is not planning to file a lawsuit against Petroliam Nasional Bhd (Petronas), but the company should pay what is owed to the state, says Chief Minister Datuk Seri Mohd Shafie Apdal.

Mohd Shafie told The Malaysian Reserve in a recent interview that Petronas should have afforded Sabah the same treatment as Sarawak, based on the court ruling.

The Kuching High Court ruled on March 13 this year that Sabah and Sarawak have the right under the Federal Constitution to impose sales tax on petroleum products.

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Sarawak assistant minister says negotiations ongoing with Putrajaya to reclaim O&G regulatory role

September 10, 2020

Dateline 2020-07-15, Malay Mail:

Negotiations to reclaim a regulatory role in the mining of oil and gas resources within Sarawak’s territorial waters is ongoing with the federal government and national oil company Petronas, Datuk Sharifah Hasidah Sayeed Aman Ghazali said today amid questions over the lack of transparency in the process.

The Sarawak assistant minister of law, state-federal relations and project monitoring also said the state is also negotiating to increase its revenue share from oil and gas and greater investment opportunities in downstream activities by the state government and Petroleum Sarawak Berhad (Petros).

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O&G firms expected to continue cutting capex

September 9, 2020

Dateline 2020-07-15, The Star:

Local oil and gas companies will still cut their capital expenditures (capex) this year as demand for the commodity remains gloomy amid the Covid-19 pandemic.

AmInvestment Bank pointed out that for the first half of 2020 (1H2020), the new contract awards to Malaysian operators dropped 62% year-on-year (y-o-y) to RM2.2bil, with the worst fallout yet to come in 2H2020 onwards.

It added that even though a measure of optimism has returned for crude oil prices, oil producers were expected to proceed with their planned production cuts this year given that demand globally remains depressed amid prolonged movement restrictions and social distancing measures across the new normal.

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Gas Malaysia releases distribution access arrangement document

September 8, 2020

Dateline 2020-07-14, The Edge:

LAST Tuesday, Gas Malaysia Bhd (GMB) released the access arrangement document for its gas distribution pipelines as part of the requirement to allow the implementation of the third-party access (TPA) regime in the Peninsular Malaysia gas market.

The document, approved by the Energy Commission (EC), was released by the natural gas distributor on its website.

The distribution access arrangement has been long awaited. It is one of the key pieces of the puzzle for allowing customers utilising the distribution pipelines to buy gas from their supplier of choice on a willing-buyer, willing-seller basis under the TPA regime, which was scheduled to commence at the start of the year.

Together with the EC-approved distribution base tariffs, the two components are required by third-party gas shippers to evaluate the costs and risks involved in using the infrastructure before approaching end consumers.

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When politics weighs on Malaysia’s only Fortune 500 company

September 7, 2020

Dateline 2020-06-29, The Edge:

IT must have been a difficult decision for Petroliam Nasional Bhd (Petronas) to back-track and stop contesting in court the petroleum product sales tax imposed by Sarawak last year.

The national oil firm is slated to pay more to the state when it has just halted exploration and slashed 2020 capex and opex in the face of volatile oil and gas prices.

Benefitting from the decision are the Gabungan Parti Sarawak (GPS) political coalition, which can ride on the success of getting a higher share of oil money, and indirectly, Petronas’ sole shareholder — the new Perikatan Nasional (PN) government, which may have to face a no-confidence vote in the Dewan Rakyat next month.

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Sarawak set to change O&G industry

September 6, 2020

Dateline 2020-07-04, Malay Mail:

THE ongoing discussion between officials from Sarawak, Petroliam Nasional Bhd (Petronas) and the federal government is one that is being closely watched by all parties.

The outcome of the talks is likely to be historic for Malaysia’s oil and gas (O&G) sector. It could also have an impact on the coffers of both the federal government and that of the state of Sarawak. Petronas’ earnings and business activities are also at stake.

Sabah, another large O&G resource hub, has also staked a claim for more tax collections from Petronas.

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