Leading contractors are preparing to submit bids within days for a floating production, storage and offloading vessel destined for Petronas’ Limbayong deep-water oil and gas development offshore Sabah, East Malaysia.

At least four contractors or consortia are said to be in the battle to land the floater prize — bids for which are due for submission on 19 January, at least three people familiar with the floater tender told Upstream.

Those expected to submit bids include Malaysian players MISC, Yinson and Sabah International Petroleum (SIP), while another grouping of compatriot Bumi Armada, India's Shapoorji Pallonji Oil & Gas and Malaysia's MTC also appears to be "quite interested”, one person said.

International floater specialists such as Modec and SBM Offshore are unlikely to participate in the Limbayong FPSO tender due to the local content requirements.

Topsides fabrication for the floater will have to be carried out within Malaysia and also potentially the construction of the turret.

Malaysia Marine & Heavy Engineering was earlier tipped as the preferred local yard for the topsides fabrication but one person familiar with the tender process said other domestic yards are now also likely to be considered by the Malaysian state-owned giant.

Petronas last year hit the market with a retender process for the Limbayong FPSO after the prior process in 2018 had been scrapped. SIP was believed to have been the lowest bidder in the previous tender, project observers said.

Petronas is looking at optimising project costs for the FPSO charter in the wake of the coronavirus pandemic and resultant low oil prices.

The Malaysian national oil company is understood to favour a conversion of an existing FPSO, although a newbuild vessel is said to still be an option, providing the price is right.

For Limbayong, Petronas requires an FPSO capable of handling an initial 60,000 barrels per day of liquids, including 40,000 bpd of oil, plus about 18 million cubic feet per day of associated gas.

The vessel, which is expected to handle up to 70 MMcfd of non-associated gas in a phased future development, is likely to have nameplate storage capacity of 600,000 barrels of oil.

Petronas is looking to charter the Limbayong FPSO for a firm 12 years, with options for three plus three plus two years.

Project observers earlier pegged Limbayong's non-associated gas reserves at around 800 billion cubic feet.

Water depths at the Limbayong field, which straddles blocks G, J and R offshore the state of Sabah, are between 900 and 1200 metres.

Field Development

Contractors poised to submit bids for Petronas Malaysia floater