KUALA LUMPUR: Sapura Exploration and Production (Sarawak) Inc (Sapura E&P), a wholly-owned subsidiary of Sapura Energy Bhd, will develop the SK408 block comprising the Gorek, Larak, and Bakong gas fields offshore Sarawak together with its partners, Petronas Carigali Sdn Bhd and Sarawak Shell Bhd.
In a statement today, Sapura Energy said it had taken the final investment decision (FID) to develop Phase 1 of the SK408 Production Sharing Contract following field development plan approval from Petronas and the signing of key terms to a gas sales agreement.
It said this would be Sapura E&P’s (formerly SapuraKencana Energy Sarawak Inc) second major upstream gas development project in Sarawak after the successful development and commencement of production from the SK310 B15 gas field.
“The development of the SK408 gas fields further strengthens Sapura Energy’s position in Malaysia as a significant partner and supplier of natural gas to one of the world’s largest liquefied natural gas production (LNG) facilities, the Petronas MLNG complex in Bintulu.
“The FID represents a critical milestone as we further progress towards unlocking the value of our gas fields, thus providing clear visibility of our long-term gas monetisation plans,” said Sapura Energy President and Group Chief Executive, Tan Sri Shahril Shamsuddin.
He said with Sapura Energy’s recent addition of its exploration acreage in Mexico and New Zealand, the group had been able to geographically diversify its exploration and production segment and put in place a well-balanced portfolio across the exploration, development and production phases.
Sapura Energy said the SK408 gas fields development project was part of the discoveries made by Sapura E&P in its 2014 drilling campaign. The fields will be developed as three separate wellhead platforms tied back to the existing processing facility and to the MLNG complex.
For SK408, Sapura E&P would be the development and production operator of the Larak and Bakong fileds, while Sarawak Shell would be the development and production operator of the Gorek field. Sapura E&P has working interests with partners Petronas Carigali and Sarawak Shell.
The latest announcement followed two important milestones for Sapura Energy of late. The first was the award of Block 30 in Sureste Basin, a proven and prolific hydrocarbon province in the Gulf of Mexico, to Sapura E&P together with its joint-venture partners, DEA Deutsche Erdoel and Premier Oil plc.
The other was Sapura Exploration and Production (NZ) Sdn Bhd getting five farm-in agreements to mature potential drilling operations within the prolific oil and gas region of Taranaki Basin in New Zealand.
The job wins reflected Sapura Energy’s success in expanding its exploration and production portfolio across more diverse and energy-rich regions around the world.
Meanwhile, DBS Group Research has estimated that Sapura Energy would benefit from its development of the Sarawak offshore gas fields, especially with the full ramp up of the SK310 B15 gas field in the current quarter. As for SK408, Sapura E&P has discovered about six trillion cubic feet of known gas reserves.
According to KAF-Seagroatt & Campbell Securities, the commencement of operations at SK408’s Gorek, Larak and Bakong fields in financial year 2021 could potentially triple the group’s total net production volume.