Shell flows first oil from next chapter of Malaysian enormous deepwater project

UK-headquartered Shell’s Malaysian business, Sabah Shell Petroleum Company (SSPC), has brought online Phase 4 of its giant deepwater development project off the coast of Malaysia.

Only months after achieving the first oil from Phase 3, Shell decided to invest in October 2022 in Phase 4 of the Gumusut-Kakap-Geronggong-Jagus East (GKGJE) deepwater offshore development project, as the operator of the Gumusut-Kakap semi-submersible floating production system (GK-Semi FPS) located off the coast of Sabah, Malaysia.

Originally, GKGJE Phase 4 subsea tie-back project was expected to reach the first oil milestone in late 2024, following the drilling of four wells and tie-back to the GK-Semi FPS. While this timeline was not met, Shell did confirm the start-up of the first oil production from Phase 4 of the GKGJE project on March 7, 2025.

The oil production from Phase 4 is flowing to the existing GK-Semi FPS offshore Sabah. The latest chapter in the Malaysian project’s book includes a subsea tie-back that straddles the Malaysia – Brunei border and involves the drilling of three producer wells and one water injection well.

Located in water depths of 1,200 meters, Gumusut-Kakap was the first deepwater project for Shell in Malaysia and began production in 2014. According to the company, GKGJE Phase 4 contributes towards its global commitment to bring on stream new upstream projects between 2023 and 2025 to deliver an additional 500,000 barrels of oil equivalent per day (boe/d) at peak production.

Siti Sulaiman, Country Chair of Shell Malaysia and Senior Vice President for Integrated Gas & Upstream Malaysia, commented: “This achievement reaffirms Shell’s ongoing commitment in innovating and executing safe, reliable, and sustainable projects that meets today’s energy needs.

“I would like to thank Malaysia Petroleum Management PETRONAS, Petroleum Authority of Brunei Darussalam, National Unitisation Secretariat, our government in Malaysia and our partners for their unwavering support in achieving this significant milestone.”

Furthermore, SSPC operates two deepwater oil-producing assets in Sabah, Gumusut-Kakap and Malikai, which were commissioned in 2014 and 2016, respectively. GKGJE Phase 4 is expected to produce approximately 21,000 boe/d on average.

Brunei Darussalam, as represented by the National Unitisation Secretariat, and Petronas signed an agreement in March 2021 to set out the terms of the unitization of the GKGJE fields’ oil and gas discoveries in Malaysia-Brunei, with SSPC appointed as the unit operator of the GKGJE unit area.

The GKGJE project is a joint venture between SSPC and Shell Sabah Selatan, ConocoPhillips Sabah, Petronas Carigali, PTTEP Sabah Oil, PT Pertamina Malaysia Eksplorasi Produksi, Shell Exploration and Production Brunei, Canam Brunei Oil, Petronas Carigali Brunei, and Brunei Shell Petroleum.

While the Gumusut-Kakap Phase 3 development achieved its first oil in July 2022, the Gumusut-Kakap Phase 2 development incorporated four additional subsea tie-back wells to GK-Semi FPS and was completed in August 2019.

Shell is also working on another Malaysian offshore project, Rosemari-Marjoram, with the start-up targeted for 2026, enabling it to supply natural gas to the Petronas LNG Complex in Bintulu, Sarawak.