Petronas Carigali farms out 20 pct interest in North Sabah EOR PSC to SMJ Energy

KUALA LUMPUR (Feb 10): Petronas Carigali Sdn Bhd (Petronas Carigali) has signed a farm out agreement (FOA) with SMJ Energy Sdn Bhd (SMJE), a wholly-owned company by the Sabah state government for the assignment and transfer of the former’s 20 per cent non-operating participating interest in the 2011 North Sabah Enhanced Oil Recovery Production Sharing Contract (2011 NSEOR PSC).

Upon completion of the transaction and subject to the fulfilment of conditions precedent, Petronas Carigali’s non-operating participating interest will be reduced to 30 per cent, while SMJE will hold a 20 per cent non-operating participating interest.

Meanwhile, SEA-Hibiscus Sdn Bhd will continue as the operator with a 50 per cent participating interest.

The agreement was signed by Petronas Carigali chief executive officer (CEO) Hazli Sham Kassim and SMJE CEO Datuk Dr Dionysia Aloysius Kibat, in the presence of Sabah Chief Minister Datuk Seri Panglima Hajiji Noor and Petronas president and group CEO Tan Sri Tengku Muhammad Taufik.

Hazli Sham said the agreement reflects the continued commitment of both Petronas Carigali and SMJE to pursue win-win partnerships that accelerate value creation and strengthen Malaysia’s upstream ecosystem.

“By building on mutual trust, shared objectives and constructive collaboration, the participation of SMJE in the 2011 NSEOR PSC demonstrates how aligned partnerships can unlock sustainable value and advance local capability development in Sabah,” he said at the signing ceremony.

The 2011 NSEOR PSC covers the Barton, South Furious, SF30 and St Joseph fields, located in shallow waters off the coast of Sabah, offshore of East Malaysia.

In 2023, Petronas Carigali and SMJE entered into an FOA for the former’s 50 per cent non-operating participating interest in the Samarang PSC.

Both companies are also partners in Blocks SB403 PSC, SB306A PSC and SB306B PSC.

Petronas Carigali said these agreements were entered into to progress the shared ambitions set out in the Commercial Collaboration Agreement (CCA) signed between the Sabah State Government and Petronas on Dec 7, 2021.

Beyond upstream activities, SMJE holds a 25 per cent equity interest in Petronas Chemicals Fertiliser Sabah and a 25 per cent equity interest in PFLNG 3.

Petronas said it remains committed to strengthening partnerships with the state and industry players, while responsibly and sustainably developing Malaysia’s hydrocarbon resources.