Oil giant ConocoPhillips' pullout from US$3.1b Sarawak project a fallout of state's rift with Petronas

A protracted rift between Malaysia’s national oil corporation Petronas and the Sarawak state government appears to be causing investor disquiet following a surprise withdrawal by United States oil firm ConocoPhillips from an oil project off the Borneo coast.

In a little-publicised surprise move this month, ConocoPhillips decided to withdraw from operating the Salam-Patawali deepwater oil and gas field that the company discovered in 2018 with Petronas in a 50-50 joint-venture that was expected to cost RM13.7 billion (US$3.13 billion).

The withdrawal was first reported by Upstream Online, a widely tracked industry news resource, on Apr 15 but has otherwise gone unreported in Malaysia media.

Two industry sources close to ConocoPhillips separately confirmed the pullout with CNA. They added that the move was part of a “country strategy review” which the company did not elaborate on.

Efforts by CNA to reach company executives in its Kuala Lumpur office were unsuccessful as telephone calls went unanswered.

Industry executives told CNA that ConocoPhillips’ move was in part driven by the uncertain regulatory environment arising from the spat between Petronas and the state government headed by Premier Abang Johari Openg.

The Sarawak government, which owns oil and gas firm Petroleum Sarawak or Petros, is demanding greater control over its resources.

The industry executives with close ties with ConocoPhillips said that the company would now be focusing on its activities in neighbouring Sabah, where it already has operations.

“The sentiment is that foreign companies are uncomfortable because they see that Petronas is under pressure in Sarawak and the oil company (Petronas) is often the joint-venture partner in many exploration projects,” said a senior executive of a Western oil contracting firm based in the capital Kuala Lumpur.

full story:
https://www.channelnewsasia.com/asia/malays...ntiment-5089371

Abang Jo and Petronas blame each other. Meanwhile, PMX chickens out...

Petronas can't folk out US$3.1b.