Petronas Vice President lays out firm’s strategies
- Business & Finance
Dato’ Wee Yiaw Hin, executive vice president of Petronas exploration and production business, gave the following interview during last week’s Offshore Technology Conference Asia. Offshore Energy Today is sharing the interview with permission from OTC Asia 2014.
Overall, the oil and gas industry in Malaysia can be described as lively again thanks to continuous effort from Petronas to rejuvenate it. Can you tell us more about your strategies and if they have delivered the results that were expected?
Wee: As Malaysia’s basins mature, we laid clear strategies to arrest reserves and production decline. Amongst others, it involved unlocking our stranded resources, designing innovative contracts, developing marginal fields, seating our assets, and intensifying our exploration efforts. The strategies have resulted in our strong performance in 2013. Petronas’ production rates have crossed more than 2 million BOE/D, placing us amongst the top five oil and gas companies. About two-thirds of this is contributed by fields in Malaysia.
We have also had significant gas discoveries in east Malaysia, allowing our gas reserves to hit above the 100 Tcf mark, and are currently managing 100 active production-sharing contracts with various international and local companies. We also have over 20 major oil and gas partners in Malaysia, with whom we have collaborated to deliver some of the region’s firsts, across the integrated oil and gas value chain.
Altogether, these projects and achievements allow Malaysia to position itself as an oil and gas regional services hub while providing energy security for the country.
What significant projects are you currently working on?
Wee: A couple of years ago, we signed an agreement with Shell to develop the world’s largest offshore enhanced oil recovery (EOR) projects (Baram Delta Offshore and North Sabah). Meanwhile, in offshore peninsular Malaysia, we are collaborating with ExxonMobil on EOR implementation at the Tapis and Guntong fields. In east Malaysia, the Sabah-Sarawak Integrated Oil and Gas Project (SSIOGP), USD 15 billion worth of large-scale projects, are currently being pursued.
The SSIOGP comprises of Gumusut-Kakap, Kebabangan, and Kinabalu NAG (nonassociated gas) projects, which will be evacuated to the Sabah Oil and Gas Terminal (SOGT). The gas from SOGT will be piped to the LNG (liquefied natural gas) complex in Bintulu via the 750-MMscf/D-capacity Sabah-Sarawak gas pipeline. Currently, we are adding capacity to the Bintulu LNG complex via the Train 9 project.
We are also building the world’s first floating LNG, which will be commissioned by 2015. Meanwhile, studying the potential for a second FLNG is in progress. The North Malay basin project will see the development and commercialization of nine stranded gas fields in offshore peninsular Malaysia. The project involves the construction of 300 km of pipeline and a new onshore acid gas removal system in Paka, Terengganu. Approximately USD 5.2 billion will be invested in the North Malay basin project through its phased development over the next 5 years. The project will commercialize around 1.7 standard Tcf of gas reserves from the area. For international ventures, our unconventional activities in Canada, development projects in Iraq, and Myanmar onshore areas are among the significant projects for Petronas E&P in the next 5 years.
How much is being allocated for research and development of new technology to rejuvenate old oil fields or increase production in maturing oil fields? What are some of the hallmark offshore technologies that Petronas has developed to date?
Wee: Petronas has allocated around MYR 1.1 billion until 2018, for our E&P Technology Centre arm to develop innovative and applicable technology to rejuvenate mature oil fields, increase production in maturing oil fields, and design ways to better monetize our hydrocarbon resources. About 150 people employed here focus on research work.
These complex challenges on the technical and commercial fronts have given birth to innovations that have helped us lower overall costs and improve the performance our assets through applied technologies. Together with our technology partners, we have developed a number of award winning technologies for offshore.
What is Petronas doing to address the “great crew change,” considering these technologies and projects fundamentally need people with the right skill sets to implement?
Wee: Petronas is recognized as one of the top five companies in Asia for leadership. In addition to offering exciting career development prospects, we also pay keen attention to growing our talent and retaining them.
On up-skilling our workforce, we collaborate with global technology partners; we will soon be revealing an integrated oil and gas training center at the Petronas Institute of Petroleum Technology.
Fully equipped with live training facilities, a diesel power rig, and a DrillSim-600 training simulator, the center focuses on providing trainees with hands-on training asit would occur in a real platform, coupled with instructor-led training and computer-based learning.
For the benefit of the industry, we will also soon be offering trainings on topics related to unconventional hydrocarbon technologies and their application, from geology to drilling, well completion to economics, through the Petronas Unconventional Hydrocarbon Center. This is possibly the first capability-building outfit of its kind in southeast Asia.