Chief Minister, Petronas clarify issues concerning SK316 offshore gas block
KUCHING: Petronas is looking for potential partners who have the technology to co-develop some of the fields in the SK316 offshore gas block in Sarawak.
Its president and chief executive officer Datuk Wan Zulkiflee Wan Ariffin said they were actually undertaking a structured process on the sanctuary and were finding partners, who can bring the technology and capabilities to explore, develop and efficiently operate the various fields and opportunities in the SK316 offshore gas block.
“This is nothing new. In SK316 offshore it involves a few fields and some of these fields are having high sour gas and high carbon dioxide.
“So we are selecting partners who have the technology that we and they can co-develop together,” he told a press conference after witnessing the signing of agreement and memorandum of understanding (MoU) between Petronas and Yayasan Hartanah Bumiputera Sarawak (YHBS) at Hilton Hotel here yesterday.
Wan Zulkiflee said this when asked to clarify reports that Petronas was considering selling a stake of as much as 49 per cent in the SK316 offshore gas block in Sarawak. He said Petronas needed partners who have technology as the fields also included exploration, which is a very high risk activity.
“So essentially this SK316 exercise is to find partners that have technology and also that will have risk appetite to do more exploration in that block. We haven’t found any partner yet, but we are in the process of selection,” he said.
Meanwhile, Chief Minister Datuk Amar Abang Johari Tun Openg, who was also at the press conference, clarified that there have been consultation with Petronas all this while.
“People were saying the state government was not being consulted. Consultation is there but I just cannot tell. There is certain thing I can tell and there is certain thing I cannot tell. But there has been consultation,” he said.
— Datuk Wan Zulkiflee Wan Ariffin, Petronas chief executive officer
He said Sarawak have to be careful before they can purchase any amount of stake in Petronas. He said even if Petronas was to offer the state government, it would not have the money to buy it.
“For the methanol plant I can find money because it only cost millions of ringgit. But this is billion of ringgit of investment and it is very risky. I would rather go for the one that were already proven because I want the money back,” he said.
Abang Johari said state government must be prudent in its spending.
“Imagine, if all our money goes there, how to build bridges, which is our priority. We have to provide infrastructure to our people, especially those in the rural areas. If it is proven, there is gas there, as I have said just now if there is marginal ground field, then I will meet Petronas to tell them that I want that oil also,” he said.
Abang Johari said Petronas was actually kind enough to tell the state government not to buy the stake because it is very risky.
He said if Petronas does not like Sarawak, they can just say go ahead, it’s up to you.
“So this is the scenario. If in this field there is oil and Petronas (ask) Abang Jo why not we produce together, that one I will go because we are the trustee of people’s money and I want to make sure that our money is well spent and there must be returns to that money for the sake of Sarawak itself, our coffers.
“With that money we have now, it is better that we implement priority projects like building the bridges for the people.
“If the risk is so high, it’s stupid of us to approach a place that is of high risk. We will lose. We are looking for a place where we will make gains,” he said.
Abang Johari added that the SK316 fields were risky as they were in the deep sea, and that certain kinds of technology could result in much carbon dioxide and sulphur content emanated, raising environmental concerns.
Wan Zulkiflee said the estimate of proven and probable gas reserves at SK316 offshore is 12 trillion cubic feet (TCF).