PETALING JAYA: Sabah has sold its first crude oil cargo from its 50% interest in the Samarang Production Sharing Contract (PSC) yesterday, marked by issuance of its official invoice to the crude oil buyer Shell International Eastern Trading Company (Sietco).
The completion of its acquisition of 50% participating interest in the Samarang PSC on May 31 has allowed Sabah to sell its crude oil entitlements at Labuan Crude Oil Terminal (LCOT) to Sietco under contract.
Subsequent sales are projected to bring in continuous revenue for Sabah for the duration of the Samarang PSC, according to a statement by SMJ Sdn Bhd (SMJSB), an oil and gas company wholly-owned by the Sabah government.
The Samarang PSC has seven existing oil and gas producing fields offshore Sabah, namely Samarang, Samarang Kechil, Sumandak, Zuhal, Alab, Erb West and Kinarut, and two gas receiving terminals in Kota Kinabalu and Labuan Island.
“Petronas Carigali Sdn Bhd (PCSB) is the operator of the Samarang PSC since 1995 and had signed a supplementary PSC agreement with Petronas in 2018 to extend the PSC operations until Dec 31, 2035.
“This is another significant development after the signing of the commercial collaborative agreement (CCA) between Petronas and the Sabah government on Dec 7, 2021,” said the statement.
On April 25, 2023, SMJSB signed a sales and purchase agreement with Petronas Chemicals Group Bhd (PCGB) for the acquisition of 25% participating interest in the Sabah Ammonia Urea (Samur) petrochemical plant.
SMJSB also signed a letter of understanding deal on the back-in option arrangement for Block SB409 Production Sharing Contract giving the Sabah-owned entity up to 20% participating interest upon completion of the work commitment or commercial discovery, whichever is earlier.
On May 31, 2023, SMJSB completed the acquisition of a 50% participating interest in the Samarang PSC.
The statement said Sabah will continue its efforts to gain further participation in the oil and gas industries in the state.