Nippon Oil begins Malaysian field development

Japanese company Nippon Oil Group has let the first contract in a $440 million development project, its first Malaysian gas development. Nippon Oil awarded a $30 million platform substructure contract for development of Helang field, on Block SK-10 off Sarawak, and plans soon to call for tenders for the topsides.


Japanese company Nippon Oil Group has let the first contract in a $440 million development project, its first Malaysian gas development.

Nippon Oil awarded a $30 million platform substructure contract to Malaysia Shipyard & Engineering Sdn. Bhd. for development of Helang field on Block SK-10 off Sarawak. Delivery of the 10,000-tonne substructure is expected next year.

Nippon soon will call for tenders for the topsides, which should be ready for installation by third quarter 2003.

First gas from Helang is expected in fourth quarter 2003, and production should peak at 250 MMcfd. Interests in Block SK-10 are Nippon Oil Malaysia, 75%, and Petronas Carigali Sdn. Bhd., a unit of Malaysian state oil firm Petronas, 25%.

Helang is one of several fields being developed off Borneo that will supply gas to Malaysia LNG Tiga Sdn. Bhd.'s complex at Bintulu, Sarawak. Helang field is expected to supply 2 tcf of gas over a 20-year period.

MLNG Tiga is increasing capacity of the gas liquefaction complex to 24 million tonnes/year (OGJ, Feb. 21, 2000, p. 26). Several LNG sales contracts have been secured for the MLNG Tiga expansion project, said Nippon Oil Malaysia Pres. Kazuo Tomita at a signing ceremony for the substructure contract in Kuala Lumpur.

Nippon holds a 10% stake in the Bintulu LNG complex.

Tomita said $330 million in loans for the development had been secured from the Japan Bank for International Cooperation and commercial banks with guarantees by Japan National Oil Corp.

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