Malaysia Marine and Heavy Engineering (MMHE) has confirmed it has been awarded the engineering, procurement, construction, installation and commissioning contract for the large Jerun development project offshore Sarawak, Malaysia.

Jerun — also known as the Block SK 408 phase two project — is due on stream in 2024, and is operated by SapuraOMV Upstream, the 50:50 joint venture company of Austria’s OMV and Malaysia’s Sapura Energy which on 13 April announced the final investment decision on the project.

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Upstream had reported on 8 April that MMHE had outflanked its principal domestic rival Sapura Energy for the big EPCIC contract.

MMHE said today its workscope comprises the construction of a 15,000-tonne topsides, 10,000-tonne jacket and 5000 tonnes of piles for the Jerun central processing platform.

It also includes the design engineering of a 30-inch carbon steel subsea pipeline with a length of 80 kilometres from the CPP to the existing E11R-B platform where gas will commingle with the existing trunkline to Petronas' LNG plant in Bintulu.

2021 has been coined as our recovery year and what better way to start it other than with a major EPCIC project like Jerun.

MMHE CEO Pandai Othman

Chief executive Pandai Othman said: “We are truly honoured to have been entrusted with such a significant project by SapuraOMV Upstream and partners. Backed by our skilled, experienced and passionate workforce, we are fully committed to deliver this project safely, timely and meeting the stringent quality requirements of the client.

“As I have mentioned before, the industry is now getting back on an upturn after the slowdown in 2020 due to the low oil price and Covid-19 pandemic, resulting in capex cutback by oil and gas giants due to the uncertainties in the industry. 2021 has been coined as our recovery year and what better way to start it other than with a major EPCIC project like Jerun.”

“With this being our first project with SapuraOMV, we hope this marks the beginning of a long-lasting business relationship and mutual support between the two companies,” he added.

The Jerun field is expected to produce 500 million cubic feet per day of gas when it comes on stream in 2024, said SapuraOMV. The current phase one gross production from the Gorek, Larak and Bakong fields is about 575 MMcfd of gas.

The partners in Block SK 408 are SapuraOMV (40%), Shell (30%) and Petronas Carigali (30%).