Mutiara Petroleum reports on potential gas find in Malaysia

Jan 06, 2004 01:00 AM

A new gas find reported by CS Mutiara Petroleum offshore the northeast coast of Peninsular Malaysia could prove to be just the tip of a large gas field that would add significantly to Malaysia's oil and gas reserves, industry analysts said.
"The latest find is a major boost to the exploration activity in the area, which had been suspected to hold large natural gas reserves in the preliminary exploration conducted there earlier," said an analyst with a bank-backed brokerage.

More importantly, it would further strengthen Malaysia’s position as one of the world's major producers of natural gas, he said. Malaysia now ranks 13th in the world with gas reserves of some 89 tn cf which will last for at least 35 years. In contrast, CS Mutiara Petroleum's new find 30 km east of the Bergading gas field in Block PM302 is estimated to have recoverable gas reserves of 0.2 t standard cf, subject to further technical evaluations.
"But although the latest find is small in comparison to the country’s reserves, it will still add significantly to the total," said UOB Kay Hian head of research Lim Beng Leong.

Other major blocks in the area under exploration or development include PM301 (gas only), also by CS Mutiara Petroleum, and PM3 (oil and gas) by Talisman Malaysia. The Malaysian and Thai governments are also expected to jointly undertake the exploration and development of another large block near the shared border of the two countries on the northern side of PM301 and PM302.
CS Mutiara Petroleum is a 50:50 joint venture between Petronas Carigali and Shell Malaysia Exploration & Production. The exploration work carried out at the joint venture's Bunga Kamelia-1 well found two gas zones in the area.

CS Mutiara Petroleum said, however, it had no immediate plan to appraise the Bunga Kamelia gas field as it was working toward its drilling campaign for this year. The offshore gas well, when developed, would benefit oil and gas companies with the capability to undertake deepwater exploration work as well as support industries, Lim said. He cited Crest Petroleum as an example.
However, news of CS Mutiara Petroleum's gas find, which it described as "significant", failed to lift interest in oil and gas shares on the KLSE. Analysts said investors might have discounted the news after the oil and gas counters' recent run-up.
"The latest gas find is positive for the industry, but the impact will not be felt immediately, given the length of time needed to develop a gas well," said TA Securities head of research Ngu Chie Kien.

Source: Star Publications (Malaysia)
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