ExxonMobil to Transfer Operations of Two Malaysian PSC Assets to Petronas

Exxon Mobil intends to transfer the operations of all assets of two production-sharing contracts in Malaysia to state energy company Petronas, Exxon Mobil said on Saturday.

Reuters had reported on Friday that Exxon Mobil had agreed to sell its Malaysian oil and gas assets to Petronas, citing two people with direct knowledge of the matter.

"This is not a sale and there will be no changes to EMEPMI's working interest in the Production Sharing Contracts," ExxonMobil Exploration and Production Malaysia Inc, or EMEPMI, said in a statement to Reuters.

"This does not impact our other businesses in Malaysia - we remain committed to conducting business here as we have for more than 130 years," it added.

In a separate statement earlier Saturday, Petronas said Petronas Carigali Sdn Bhd is engaged in discussions with EMEPMI regarding the transfer of operations for two production-sharing contracts located offshore peninsular Malaysia.

"The discussions are subject to further agreements between both parties," it said in response to a Reuters query. "Petronas Carigali remains committed to safe operations, as well as maintaining reliable and uninterrupted energy supply for our customers throughout the process."

Malaysian media have reported that Exxon Mobil has been trying to sell its ageing upstream assets in the country since 2020.

Under the transfer plan, Petronas was taking over operations of Exxon Mobil assets including the Tapis oilfield in Terengganu, which began production in 1978, Reuters reported on Friday, citing three people.

Exxon Mobil staff would be transferred to Petronas as part of the deal, one of them said.

The terms of the deal were not immediately known.

In an article on its website dated Nov. 12, 2023, Exxon Mobil said it remained a significant energy producer in Malaysia, contributing about 40% and 50%, respectively, to Peninsular Malaysia's crude oil and natural gas production.

The company operates 35 oil and gas platforms in 12 fields offshore Terengganu, and has a working interest in another 10 platforms in five fields in the South China Sea.

The combined operations produce about 15% of Malaysia's crude oil and condensate of 600,000 barrels a day, and more than half of peninsular Malaysia's natural gas of more than 2 billion cubic feet per day.

Its last major investment in the country was in a $2.5 billion enhanced oil recovery project at the Tapis field, which started up in late 2014.

(Reuters - Reporting by Yantoultra Ngui and Florence TanEditing by Frances Kerry and Giles Elgood)

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