Oil and gas firms eye Asia-Pacific deepwater fields
New Straits Times(BizNews)
19 January 2007

Oil and gas companies are eyeing Asia Pacific’s deepwater fields to tap crude oil estimated to be worth US$10 billion to US$15 billion (RM35 billion to RM52.5 billion) over the next five years, Asian offshore industry players said.

Already there are notable projects in the region, namely in the Philippines, Australia, Kikeh deepwater field offshore Sabah, and India.

Deepwater exploration activities are due to intensify with strong oil projects.

Manager, project engineering, field development, Petronas, Zulkifli Abdul Rani estimated that the deepwater fields in the region hold a huge production potential.

There is no standard definition for deepwater fields and in the case of Malaysia they are defined as areas with a depth of more than 200 metres to 1,000 metres.

It has been reported that Malaysia has about 19 deepwater blocks offshore Sabah and Sarawak.

The Kikeh Field, which is the country’s first deepwater field, is jointly developed by Murphy Oil Corp and Petronas Carigali Sdn Bhd, a subsidiary of the national oil company.

It is expected to start production in the fourth quarter of this year, churning out about 120,000 bpd of oil.

Gulf of Mexico leads the worldwide trend of deepwater fields, followed by the North Sea, Africa and Brazil.

“In the case of the Asia Pacific region, there are also lots of opportunities in this new frontier as deepwater blocks hold good news to both the governments and the industry players.

“But there is the challenge of limited resources in the region – cost-effective field development, the lack of deepwater R&D and also manpower to manage the deepwater development,” Zulkifli said when presenting his paper on “Managing deepwater growth in the Asia-Pacific region with limited resources” at the two day Offshore Asian Conference in Kuala Lumpur which ended yesterday.

He said global sharing in deepwater exploration, development and production is essential to address the constraints of the Asia Pacific region.

Other presenters at the conference also warned that the manpower shortage could be aggravated in two years if oil firms go ahead with their exploration in the region, unless the price of oil drops to below US$40 (RM144) per barrel.