Page 12 - FSUOGM Week 44 2019

FSUOGM POLICY FSUOGM
Turkmenistan to extend Petronas’ PSC for Block 1
TURKMENISTAN
Petronas has
been working in Turkmenistan since 1996.
MALAYSIAN Prime Minister Mahathir Mohamad has said Turkmenistan will extend state-owned Petronas’ production-sharing con- tract (PSC) for offshore Block 1 in the Caspian Sea until 2038. The PSC for the natural gas block was originally awarded for 25 years in 1996.
Mohamad said he had discussed the matter with Turkmen President Gurbanguly Berdimu- hamedov on October 27, during a two-day offi- cial visit to Turkmenistan.
“[Berdimuhamedov] expressed his wish that Petronas continue to be active here, and he men- tioned a further 10-year extension,” Mahathir told a press conference that day.
Mahathir said the extension demonstrated Ashgabat’s satisfaction with Petronas’ develop- ment efforts and that he was confident the state major could win further concessions in the Cen- tral Asian state.
Malaysian Economic Affairs Minister Seri Mohamed Azmin Ali tweeted the same day that the company had invested $10bn in the country to date. Ali added that he had been briefed by Petronas Carigali Turkmenistan CEO Ruslan Abdul Ghani at the Ashgabat office that day.
Malaysian Ambassador to Turkmenistan Roseli Abdul said on October 26 that Mahathir’s’s visit would consolidate Petronas’ involvement in Turkmenistan’s upstream.
“Tun Dr Mahathir’s main focus in this visit [is] to enhance economic co-operation,
especially in the oil and gas industry. Both lead- ers are also expected to discuss regional and global issues,” he told reporters.
Roseli noted that in the eight years since the Malaysian government had opened its embassy in Ashgabat, diplomatic officials had “worked closely with Petronas Carigali Turkmenistan for the interests of the nation, besides also exploring new fields such as trade and commerce, tourism and education.”
Turkmenistan has estimated proven natural gas reserves of 20tn cubic metres, behind only Russia, Iran and Qatar.
Block 1 spans almost 1,500 square km and holds five known oil and gas fields. First oil pro- duction was achieved in 2006, followed by first gas in 2011. Output currently averages around 65,000 barrels of oil equivalent per day, with oil exported via tanker across the Caspian Sea and gas sold domestically.
Petronas has switched the focus of its upstream capital expenditure to focus on for- eign projects in recent years. Of the MYR27.3bn ($6.53bn) invested on upstream projects in 2018, 69% went on overseas developments.
Fitch Ratings said in September that it predicted Petronas’ capex to remain around MYR50bn ($11.96bn) per year over the next five years. Upstream investment is projected to total MYR167.6bn ($40.1bn) over that time frame. ™
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w w w . N E W S B A S E . c o m Week 44 06•November•2019