SINGAPORE�Malaysian state oil firm Petronas signed a production-sharing contract with Sarawak Shell Bhd. (SSB) and Petronas Carigali for Block SK312 off Sarawak. SSB and Petronas Carigali, a unit of Petronas, will have 70-30 equity participation in the block, which will be operated by SSB.
The block is about 200-km northwest of Bintulu and covers about 6,000 sq km in the Central Luconia gas province. The block comprises the relinquished part of Block SK-8, previously operated by Shell Oil & Gas (M) LLC.
A recent study conducted by SSB identified new, in addition to the existing, hydrocarbon prospects on the block. Under terms of the contract, Sarawak Shell and Petronas Carigali will acquire and process 1,500 line-km of new 2D seismic and reprocess 500 line-km of existing 2D data. They will also drill one wildcat to a minimum depth of 1,500 m and undertake a comprehensive review of the petroleum potential of the block.
Meanwhile, Petronas is reportedly finalizing an oil production deal in the North African country of Chad. Petronas Pres. Hassan Merican said his company is interested but declined to comment on the matter, as it was still under negotiation.
Chad President Idriss Deby said his government would soon select foreign partners for a $3.5 billion oil field and pipeline project that was hit by wavering interest among some of the original investors.
Royal Dutch/Shell has confirmed that it would probably withdraw from the pipeline project. TotalFinaElf SA unit Elf Aquitaine is also considered likely to sell its 20% stake in the Doba basin venture, which promises to double income for one of the world's poorest nations. ExxonMobil, the project operator, will keep its 40% holding.
Petronas was expected to buy a 35% stake in the production side of the project by the end of February. The US oil giant Chevron will take 25%.