BP PLC to sell offshore Malaysia gas producing assets
BP PLC plans to sell its share of a major gas-producing block off Malaysia for about $500 million. It said its 25% interest in Block A-18 of the Malaysia-Thailand joint development area no longer fits its core strategy for the region.
By the OGJ Online Staff
LONDON, Dec. 6 --BP PLC plans to sell its share of a major gas-producing block off Malaysia for about $500 million.
BP said its 25% interest in Block A-18 of the Malaysia-Thailand joint development area (JDA) no longer fits its core strategy for the region.
A BP spokesman said, "We have decided that our ownership does not comply with our corporate goal of being number one or two in the basins in which we operate."
BP's main focus in southeast Asia is on core liquefied natural gas developments such as Tangguh in Indonesia and the Australian North West Shelf. The company is also interested in developing its leadership positions in pipeline gas in Indonesia, southeastern China, and Viet Nam.
The Block A-18 asset is an offshore production-sharing contract that BP inherited when it took over Atlantic Richfield Co.
The partners are Trans Thailand Malaysia Co. (TTM), which is operator with 50%. Petronas Carigali Sdn. Bhd. of Malaysia and PTT Exploration and Production PLC (PTTEP) of Thailand jointly own TTM, which has contracted to buy the gas from the block and signed contracts to develop a pipeline export system. Amerada Hess Corp. holds the other 25%.
The main gas field on the block, Cakerawala, is being developed via five offshore platforms, three of which are installed and two are under construction. The first phase of development will produce 390 MMcfd, with subsequent phases of development planned to double production. First gas will flow once the TTM pipeline system is constructed and able to receive the gas. The upstream project will be complete ahead of this schedule.
BP said it would remain a significant investor in Malaysia where its interests are primarily in the chemicals business as well as a downstream oil and lubricants business.