Shell and Petronas came to an agreement to extend previously signed Baram Delta PSC for enhanced oil recovery projects offshore Sarawak to include gas rights.
With the signing of the Heads of Agreement (HOA) for Baram Delta Gas Gathering Project 2 (BARDEGG2), associated and non-associated gas rights linked with the Baram Delta Operations will be incorporated into the 2011 Baram Delta EOR PSC. The Tukau Timur field, previously part of the SK307 PSC, will also be integrated into the 2011 Baram Delta EOR PSC enabling non-associated gas to be developed as part of a single integrated development project. With the expansion of the 2011 Baram Delta EOR PSC, Shell and Petronas Carigali will gain access to gas rights not previously included under the 2011 Baram Delta EOR PSC.
The signing of the Heads of the Agreement was held on Tuesday June 24th, 2014 with the management teams from Shell, Petronas and Petronas Carigali Sdn Bhd in attendance.
BARDEGG2 and Baronia EOR projects will be undertaken as a single integrated development project that is operated by Petronas Carigali Sdn Bhd. The projects will see a new central processing platform located at the Baronia field which will initially extract non-associated gas from the Baronia field and together with the existing associated gas production will be used for re-injection together with water into the Baronia reservoir to enhance oil recovery. Excess gas and Tukau Timur gas will be sold to Petronas for domestic supply in Bintulu and Miri, and for export to the Bintulu Petronas Malaysia LNG complex.
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Press Release, July 3, 2014; Image: Shell