A Review Of Offshore Oil Fields Development In Malaysia

Abstract

Abstract This paper is a review of offshore oil fields development in Malaysia. Development of an oil field is typically divided into a number of major phases namely exploration and field appraisal, development planning, project implementation and field production. For an offshore oil field development, it requires careful planning and considerations during all of the phases. The requirements for field appraisal, subsurface development planning and facilities options are reviewed. During field production, special considerations are required to manage the field. Introduction The history of first commercial oil development in Malaysia dated back to as early as 1910 when the Anglo-Saxon Petroleum Company, forerunner of the present day Sarawak Shell, developed the Miri oil field in Sarawak. From a small production of 83 barrels per day about 80 years ago, the petroleum industry in Malaysia has grown into a multi-billion dollar business. The industry underwent a dramatic expansion with rapid intensification in exploration and development. As of 1 January 1994, a total of 883 exploration wells have been drilled in Malaysia resulting in the discovery of a total of 99 oil fields. At present, 32 oil fields are in production. The present producing oil fields are located offshore Peninsular Malaysia, Sarawak and Sabah (Figure 1). Offshore oil field development requires special consideration during the exploration, appraisal, field development, project implementation and field production phases. The scope of work and capital expenditure is generally greater for an offshore field development. The development requires a long project lead time before the first drop of oil can come onstream. In addition, the oil reserves and well productivity need to have certain threshold value to offset the greater expenditure (capital/operating) and long project lead time. More detailed study are required, especially in the areas of reservoir data acquisition. This paper attempts to identify the critical factors that need to be considered during the major phases of oil field development namely exploration, appraisal, field development, project implementation and field production. The subjects that will be discussed are based on Malaysia's experience. EXPLORATION AND APPRAISAL Exploration Considerations Drilling an offshore wildcat well can incur a substantial expenditure. In Malaysia, generally, this can range from RM$5 to RM$15 million, depending on the well depth and production tests requirement. Hence, it is of great importance to properly assess all the available data and information before committing to drilling of an exploration well, which carries an element of risk. P. 475