Abstract

Global competition for hydrocarbon exploration and production has become more challenging as many sedimentary basins are maturing. To face these challenges, PETRONAS has taken an aggressive approach in promoting Malaysia's exploration acreage to multi-national oil companies to ensure the sustainability of the country's petroleum resources and reserves base.

Since the discovery of the Miri oil field in 1910, oil and gas exploration in Malaysia has undergone a tremendous transformation. Over the last two-and-ahalf decades, the country's petroleum activities were accelerated with some RM8 billion spent on exploration and RM49 billion invested in development and production activities. As petroleum is a depleting resource, PETRONAS has continuously provided stimulus to encourage exploration activities to augment Malaysia's oil and gas reserves.

Since 1974, PETRONAS has signed a total of 75 Production Sharing Contracts (PSCs) with 31 operators from 11 different countries. Forty-five PSCs are currently in operation with 29 of which are the Exploration PSCs and Technical Evaluation Agreement. To date, more than 1.3 million line-km of 3D and 600,000 line-km of 2D seismic data were acquired in Malaysia. The PS Contractors have drilled more than 950 wells resulting in the discovery of 134 oil fields and 173 gas fields. Eighteen of these wells were drilled in the deepwater acreage based on the Deepwater PSC terms. Comparatively speaking, based on an average success ratio of 1 in 5, Malaysia's exploration efforts can be considered very good in this region. To date, more than 8.0 billion Standard Tank Barrel (STB) of oil and 100 trillion Standard Cubic Feet (SCF) of gas reserves were discovered, of which 4.8 billion STB of oil and 13 trillion SCF of gas have been produced. As at 1 January 2002, Malaysia's total remaining reserves (crude oil plus condensate) stand at 4.2 billion STB of oil and 87.5 trillion SCF of gas.

Over the last 12 months, the results of exploration drilling have been encouraging. Ten new oil fields and four gas fields had been discovered from a total of 31 exploration wells drilled with a total new reserves addition of 300 million STB of oil and 1.7 trillion SCF of gas. A recent breakthrough in the Malaysian deepwater exploration is the oil discovery by Murphy Oil in deepwater Block K, offshore Sabah. This is the first major oil discovery in a water depth of more than 1,000 meters. In the next couple of years, more wells are planned to be drilled in the deepwater blocks and more discoveries are expected to be made.

Presented at: 2005 South East Asia Petroleum Exploration Society (SEAPEX) Conference, Singapore, 2003