Putrajaya (The Star/ANN) - Petroliam Nasional Bhd (Petronas) and Shell Malaysia have signed a deal worth 37.3 billion ringgit (US$11.76 billion) that will see the implementation of the world's largest enhanced oil recovery (EOR) projects off the shores of Sabah and Sarawak over 30 years.
Prime Minister Najib Tun Razak said the project was expected to extend the lifespan of the oil fields beyond 2040 and also lead to increased oil production.
"The project will include the building of local capabilities in a niche technology area as well as increasing the average recovery factor in Baram Delta and North Sabah fields from 36 per cent to about 50 per cent," he said after witnessing the signing of two new production sharing contracts for the EOR projects yesterday.
"The improvement in the recovery efficiency of the oil fields is expected to positively impact Malaysia's oil reserve," Najib said.
He said the government had identified the rejuvenation of existing fields through EOR as one of the 19 Entry Point Projects in order to provide additional supplies for the country's power and industrial needs.
"The team will also undertake joint research and development in the area of EOR technology.
"This is a radical shift in our development strategy and serves as an opportunity for Malaysia to be at par with other high-performing Asean countries," he said.
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