PTTEP Makes Gas Discovery Offshore Malaysia: Update
(Updates with comments from Wood Mackenzie)
A subsidiary of Thai state-owned PTT Exploration & Production, PTTEP HKO, has made a gas discovery offshore Sarawak, Malaysia, PTTEP said June 27. The exloration well, Lang Lebah-1RDR2, was the first to be drilled in Sarawak SK410B, PTTEP said and is the Thai company's biggest find so far.
The well encountered 252 metres of net gas pay. “The well was tested in carbonate main target reservoir with a completion-constrained (2-7/8” tubing) rate of 41.3mn ft3/day and 246 barrels of condensate/day through 40/64-inch choke size,” the company said. The discovery will require further drilling to confirm upside potential, it added.
Sarawak SK410B project is located in the shallow waters, about 90 km offshore Sarawak and covering some 1,870 km2. The consortium consists of PTTEP HKO (the operator), Kufpec and Petronas with participating interests of 42.5%, 42.5% and 15% respectively.
Commenting on the discovery, Wood Mackenzie estimated it at 2 trillion ft³, making this the seventh largest global discovery of the year. It is in the deeper, high-pressure, high-temperature reservoir of the basin, and looks potentially to have relatively 'clean' gas qualities and low impurity content."
The discovery is in the gas-rich Sarawak-Luconia-East Natuna basin, which has enjoyed an exploration success rate of 55% over the past 10 years, above the 37% global average, Wood Mackenzie senior analyst Huong Tra Ho said.
"We expect Lang Lebah to have a high chance of commercialisation as feedgas into the Malaysia LNG (MLNG) complex. The plant is in urgent need of new supply as existing sources have only met 85% of its requirements in 2018. Legacy fields have experienced sand influx and water breakthroughs, while many of the remaining undeveloped discoveries require advanced carbon dioxide and hydrogen sulphide processing. Gas quality will thus be crucial to determining the speed and ease of future monetisation plans for Lang Lebah, which is also close to existing infrastructure," WoodMac said.
Lang Lebah highlights the company's capability in handling technically challenging reservoirs and reinforces its business development credentials, it said.
"It also represents a big win for the Thai national oil company, which has been aggressively securing resources across Southeast Asia over the past year, particularly Malaysia. The news comes on the back of PTTEP's acquisition of Partex and Murphy Oil's Malaysia portfolio, which together make it the third largest upstream acquirer in 2019."