Business

Saturday January 26, 2013

Petronas aborts RSC award

By TEE LIN SAY
linsay@thestar.com.my


PETALING JAYA: Petroliam Nasional Bhd (Petronas) has aborted the award for the small field risk service contract (RSC) for the Tembikai and Chenang clusters offshore Terengganu.

The national oil company said yesterday it “will not be re-opening the cluster for bidding.”

Petronas issued the statement following recent speculation regarding the award of the contract.

Sources who are familiar with the clusters said the main reason for the closure of these clusters was the insufficient infrastructure for gas transportation in that area. They said that there were not enough gas pipelines to cope with any extra gas output at the moment. Tembikai and Chenang are gasfields with some oil potential.

Shedding light on the announcement, a source said the nearest gas pipeline to Tembikai and Chenang was the Angsi pipeline, now being utilised at full capacity from the Angsi field, some 100 km away.

“From this pipeline, the gas is transported to Kerteh for processing. When Tembikai and Chenang were opened for bidding, the gas from these fields were meant to be transported using the Angsi pipeline. Now, however, as the Angsi field will likely be using that pipeline for the next 10 to 15 years, I don't think Tembikai and Chenang will be up for bids anytime soon,” said the source.

However, the source added that Petronas had some 107 marginal fields and would likely be putting a few fields up for grabs every year to take advantage of strong oil prices and ensure oil production was up.

“There will be more marginal oilfields up for grabs, and they will most likely be oilfields. Petronas will probably be inviting bids from some of the foreign players in the February and March periods.”

When StarBizWeek contacted Petronas for more details, its spokesperson declined to comment.

To recap, Scomi Group Bhd had on Jan 11 confirmed it had provided support to bid for Petronas' RSC for the cluster. However, Scomi was not aware if Petronas had awarded the RSC project.

Earlier, news reports had stated that the bid for the Tembikai and Chenang oilfields had been re-opened after the bid by frontrunner Scomi Group-Cue Energy Resources Ltd was said to have faced some problems.

The contract was never awarded to this group and it is still not clear why. StarBizWeek had also reported that Cue Energy saw the resignation of two key people its chief executive officer Mark Paton and chairman Richard Tweedie back-to-back in mid-November last year, signalling trouble in the company.

Sources had earlier said that Scomi could possibly be still in the running for these fields, if it could find a new partner. It has been reported that Tembikai and Chenang had contracts valued at between US$200mil (RM608.9mil) and US$400mil (RM1.22bil) each.

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