Malaysian marginal fields specialist Vestigo Petroleum has been awarded a new production sharing contract for the development of two small offshore oilfields with combined estimated recoverable reserves of 10 million barrels of oil.
The South East Collins Cluster, located in water depths of 42 metres to 45 metres 70 kilometres north-east of Labuan Island, comprises two fields - South East Collins and Lokan - discovered in the 1980s.
The fields will be developed under newly-introduced small field asset (SFA) PSC terms, said national oil company Petronas, which awarded the PSC to Vestigo on 21 April 2021.
Petronas senior vice president of Malaysia Petroleum Management, Mohamed Firouz Asnan, said: “The award of the cluster of fields under the much-anticipated new fiscal terms is expected to spur the development and production of more small fields in the future. The new SFA PSC is aimed at monetising an inventory of small discovered resource opportunities available in Malaysian waters. Vestigo was chosen based on its track record as a low-cost operator in developing and operating small fields."
We welcome operators who are specialised in the development of small fields to extend their capabilities here in Malaysia.
Mohamed Firouz Asnan
He added: “We welcome operators who are specialised in the development of small fields to extend their capabilities here in Malaysia.For many of these fields to work, we need operators with the right mindset and business model to take advantage of the customised fiscal and non-fiscal terms offered by Petronas. Under the current volatile oil prices, these operators must also employ innovative solutions to ensure the lowest total life cycle cost."
Vestigo is a subsidiary of Petronas Carigali, the exploration and production arm of Petronas. Vestigo operates the Irong Cluster PSC, the SK315 PSC, the PM335 PSC and the Tembikai Chenang small field risk sharing contract. It also holds non-operating interests in the PM9 PSC and the SK407 PSC.