LNG

McDermott, the US energy and liquefied natural gas project engineering company, was awarded an offshore pipeline and installation contract from Shell subsidiary Sarawak Shell for the Selasih natural gas fields pipelay and heavy-lift project off the coast of Sarawak in East Malaysia to help underpin LNG production.

Shell is the operator for the exploration acreage and new fields in the F22 and F27 Selasih area which are part of the Malaysia LNG extension and production sharing contract (PSC).

Nearly all the gas produced offshore Sarawak is supplied to Malaysia LNG and to the gas-to-liquids (GTL) plants in Bintulu.

Analysts note that Shell is still very active in Malaysia and is involved in oil and gas offshore Sabah and Sarawak under about 16 PSCs in which its interests range from 20 percent to 85 percent.

Offshore Sabah, the UK-based major’s local subsidiary operates two producing oil fields, including the Gumusut-Kakap deepwater field, with Shell’s interest 29 percent, and the Malikai deepwater field, Shell interest 35 percent.

However, Shell is even more active offshore Sarawak where it is the operator of eight producing gas fields with Shell’s interest 50 percent.

Among the projects were included the 2019 abandonment of depleted wells for the Serai field and the Saderi fields.

Shell then signed agreements for the extension of the Malaysia LNG PSC using other sources.

McDermott scope

Under the scope of the latest contract with Shell, McDermott said it would perform transportation and installation services for two pipeline segments and one section of flexible pipelay.

McDermott will also provide pre-commissioning works on all infield pipelines and perform the structural installation of three jackets and topsides.

“This is the fourth project we are executing for Shell under the Subsea and Floating Facilities project portfolio, demonstrating the strength of our long-standing relationship,” said Mahesh Swaminathan, McDermott's Senior Vice President for Subsea and Floating Facilities.

The project management and engineering will be executed in Malaysia, leveraging the local expertise.

Offshore installations will be performed using the “DLV2000”, McDermott's versatile heavy lift and pipelay vessel.

“To ensure efficient project delivery, we will draw upon the expertise from our Kuala Lumpur center, which supports the global execution of subsea and offshore projects,” stated Swaminathan.

Malaysian Energy company Petronas has announced the launch of its LNG delivery service by truck for off-grid small-scale customers across Peninsular Malaysia from the regasification terminal at Pengerang in the state of Johor.

“Petronas provides industries in Peninsular Malaysia that are not connected to the natural gas infrastructure with an option to switch to gas as an alternative form of cleaner energy,” said the company.

As part of the pilot phase, Petronas completed its first delivery of LNG to a tyre manufacturing plant for the company, Continental Tyre Alor Setar Malaysia.

“The solution forms a part of Petronas’s commitment to environmental sustainability and to drive the growth of natural gas usage in Malaysia,” said Adnan Zainal Abidin, a Petronas Executive Vice President and Chief Executive of the company’s Gas and New Energy division.

He said that by establishing the necessary infrastructure the national oil and gas company offers customers a cleaner and competitive form of energy for power.

“We achieve this by embracing our customers pain-points in our strategies which results in strong collaborations across Petronas’s value chain to provide an integrated solution,” he explained.

“Ultimately, we provide a one-stop centre for off-grid customers, covering supply, loading facilities and logistic services to ensure that their cleaner energy needs are met,” he added.

“The launch of our latest solution is a testament to how Petronas delivers customer-centric solutions through our focus on innovation,” stated Adnan.

Along with other global energy companies, Petronas recently posted a loss due to lower prices and a curtailment of economic activity because of Covid-19.

Petronas reported a first-half loss of 16.5Bln Malaysian ringgit ($3.97Bln) and a 23 percent year-on-year reduction in revenue to 93.6Bln ringgit ($22.5 billion) on the back of lower average realised prices and a drop in sales volumes for processed gas and LNG.

The company said that it was looking at ways of cutting costs, including wage cuts to avoid reducing its number of employees.

Petronas President and Chief Executive Muhammad Taufik Tengku Aziz, said the company was considering pay cuts for its more than 47,000 employees in the light of the continued challenging market conditions.