
Petroliam Nasional Bhd. (Petronas) and Shell PLC have exited the Kebabangan Cluster Production Sharing Contract (KBBC PSC) offshore Malaysia’s Sabah state, leaving the producing asset to co-venturer ConocoPhillips.
“With an export capacity up to 750 million standard cubic feet of gas per day (MMscfd), the continuation of the KBBC PSC until the end of 2050 and other commercial agreements have been structured to ensure future gas field developments remain economically attractive in supporting Sabah’s energy security requirements”, Malaysia’s state-owned Petronas said in an online statement.
Kebabangan had been under a joint venture between the three companies. Petronas Carigali Sdn. Bhd. owned 40 percent, while Shell Energy Asia Ltd. held 30 percent. ConocoPhillips Sabah Gas Ltd. has now increased its ownership from 30 percent to 100 percent.
The cluster contributed 47 million cubic feet a day of natural gas and 1,000 barrels per day of oil to ConocoPhillips’ 2023 production, according to a fact sheet published online by the Houston, Texas-based company.
Kebabangan started production late 2014. The PSC ends 2037, says the fact sheet, published April 2024.
Kebabangan gas is transported from the KBB platform via pipeline for sale to the domestic market. In 2019, KBB was tied in to a nearby third-party floating liquefied natural gas vessel, which increased gas offtake capacity, according to ConocoPhillips.
Sabah Chief Minister Panglima Haji Hajiji said of the full transfer to ConocoPhillips, “Sabah is rapidly emerging as a preferred destination for oil and gas investments, thanks to the strategic developments and partnerships championed by PETRONAS and its industry collaborators”.
“These initiatives underscore the vast potential of Sabah’s resources and reinforce our commitment to driving economic growth and creating opportunities for our people”, Panglima added.
Bacho Pilong, senior vice president of upstream regulator Malaysia Petroleum Management, welcomed what he said is “ConocoPhillips’ expanded role in Malaysia’s upstream sector, which underscores the continued confidence in the nation’s energy potential”.
Recently the same Kebabangan consortium won five fields offshore Sabah, one of two states on the Malaysian side of Borneo island. The fields — Bagang, Batai, Biris, Rempah and Ubah — are under the Deepwater Revenue-over-Cost PSC, or the Ubah Cluster.
“The Ubah Cluster can greatly benefit from integration with the Kebabangan field, especially considering that both are operated by the same contractors – this integration can lead to various synergies and advantages for the operations of both fields”, Petronas said in a press release December 5, 2024.
The areas were part of the 2024 Malaysia Bid Round. Petronas is scheduled to launch the next Malaysia Bid Round in the first quarter of 2025.
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