SapuraOMV Upstream has announced its first production of the Larak gas field under the SK408 Production Sharing Contract (PSC). Pix courtesy of SapuraOMV

KUALA LUMPUR: SapuraOMV Upstream has announced its first production of the Larak gas field under the SK408 Production Sharing Contract (PSC).

The PSC was delivered within budget, following the start-up at the end of December, SapuraOMV said in a statement yesterday.

The SK408 gas fields were part of discoveries made by SapuraOMV in a drilling campaign in 2014, it added.

The fields were tied back into an existing processing facility and gas was transported through existing pipelines for onward gas processing at Petronas LNG complex in Bintulu, the company said.

“This achievement will strengthen our presence in the existing market, propelling us to become one of the most significant gas producer in the country and in the region.

“This will further cement our position as a trusted and reliable oil and gas company,” said SapuraOMV chairman Tan Sri Shahril Shamsuddin in the statement.

The development of SK408 is aimed at commercialing gas reserves from the Gorek, Larak and Bakong fields, which will help meet the growing gas demand in Asia.

“This production start is a positive signal and demonstrates OMV’s commitment to the Asia-Pacific hub. It shows once more the strengthening of the gas focus in our production portfolio,” said Johann Pleininger, executive board member responsible for upstream and deputy chairman of OMV.

The SK408 development is SapuraOMV’s second major upstream gas development project in Sabah and Sarawak, following the successful development and commencement of production from the SK310 B15 gas field.

With the full ramp-up of the first phase of SK408 comprising the Gorek, Larak and Bakong fields, SapuraOMV’s production is expected increase to more than 30 kilobarrel of oil equivalent daily, with the majority being gas.

SapuraOMV’s partners under SK408 PSC are Sarawak Shell Bhd (30 per cent) and Petronas Carigali Sdn Bhd (30 per cent).

SapuraOMV is a strategic partnership between Sapura Energy Bhd and OMV Exploration and Production GmbH, a subsidiary of Austria’s OMV Aktiengesellschaft.