OPPORTUNITIES AND GROWTH
IN THE OIL AND GAS INDUSTRY
IN SABAH
Day 2 Paper III:
“Sabah Oil and Gas; A Sustainable Future for Sabah SMEs”,
Dato’ Paduka Udani Bin Dato’ Seri Mohamed Daud,
Group Executive Chairman, MaxEnergy Group
GRAND BALLROOM,
THE MAGELLAN SUTERA HARBOUR RESORT
KOTA KINABALU SABAH
13th & 14th April 2015
28 January 2015
MXLT 02/2015
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OPPORTUNITIES AND GROWTH
IN THE OIL AND GAS INDUSTRY
IN SABAH
Day 2 Paper III:
“Sabah Oil and Gas; A Sustainable Future for Sabah SMEs”
The future potential of oil & gas production within Sabah provides a unique
opportunity for SMEs to participate and thrive together with this coming growth.
This paper seeks to share some thoughts and observations for SMEs and
entrepreneurs in Sabah to start in the Oil & Gas industry and some key criteria to
have a successful start-up and create a sustainable business in the Oil & Gas
industry.
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Since 2005, a common definition for SMEs has been endorsed by the
National SME Development Council (NSDC).
In July 2013 a new SME definition was endorsed due to the many
developments in the economy since 2005 such as price inflation,
structural changes and change in business trends.
1. ‘Manufacturing’
2.
refers to
physical
or
chemical
transformation of materials or
components
into
new
products.
‘Services’ refer to all
services including distributive
trade; hotels and restaurants;
business, professional and ICT
services; private education
and health; entertainment;
financial intermediation; and
manufacturing-related
services such as research and
development (R&D), logistics,
warehouse, engineering etc.
3. ‘Others’ refer to the
remaining 3 key economic
activities, namely:
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(i) Primary Agriculture
(ii) (ii) Construction
(iii) Mining & Quarrying
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Sabah Oil & Gas production being driven by the Deepwater fields
being developed and potentially to be discovered providing at least a
30 year production horizon.
Murphy, Shell, KPOC, PCSB have current or coming production
The recent Bestari discovery by JX Nippon will spur more explorationinterest
Block R Bestari 1 7Apr15
JX Nippon, Inpex, Santos, PCSB
Oil Pay 70 met. Water Depth 1400 m
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Sabah’s Oil & Gas Entry Point Projects are ongoing currently focus
on the West Coast : SAMUR I & II, SOGT, SSGP, KK & Kimanis
Power Plants. East Coast to come.
Sabah Petrochemical Industry
Master Plan
The State Government had identified
SOGIP as the dedicated park for oil and
gas industry, therefore a Master Plan is
necessary to be produced with specific
focus to SOGIP
Source: SEDIA
Sabah State & PETRONAS have foundation initiatives acting as
catalysts to spur the development and growth of the Oil & Gas
industry in Sabah by providing Entry Points for SMEs
1
Kota Belud Supply Base
BUILDING KEY ONSHORE
FACILLITIES & SAMUR
Proposed Development for a
integrated Oil & Gas Base Facillity
Oil Pay 70 met. Water Depth 1400 m
2
Kimanis PP
Investment
Jobs
RM 1b
3300
DEVELOPING HUBS TO BUILD
CRITICAL MASS i.e.
SOGIP
Kota Belud Supply Base
SOGT & SSGP
Invest
Jobs
RM 5.4 b
3000
SOGIP Ph1 – SAMUR and Ph2 - Mitsui
LD Re-Gas Terminal
Lahad Datu PP
Invest
Jobs
Invest
Jobs
Invest
Jobs
RM4.6 b
5,128
RM 1.2 b
3500
RM 1 b
3300
The Oil & Gas industry globally is very dependant on the contractors
community to support it’s projects and operations.
Manhours Worked
Oil Companies
Contractors
Globally
Malaysia
14 % 20 %
86 % 80 %
Of the 4000 + companies providing services
& products across the E&P value chain
about 60 % are Malaysian SME Cos
Major Activities in the Oil & Gas industry
Ratio of Engineers to Skilled Manpower
The mix varies dependant on activity
Pipeline Construction &
Maintenance
1 : 20
Plant Construction
1 : 100
Plant Maintenance
1 : 50
Production Operations
1 : 20
Production Maintenance
SubSurface Geoscience
50 : 1
1 : 50
Technology Development
1:1
Drilling & Drilling Services
1 : 30
Offshore Installation & HUC
1 : 50
STARTING UP
Sabahan SMEs need to meet the key requirements of the Oil & Gas
industry and to fulfill the MTR of the relevant PETRONAS LICENSE
SWEC code requirements
1
SAFETY
SAFETY SYSTEMS & CULTURE
On Paper, In the Mind, With Heart
2
COMPETENCY
SAFE, SKILLED & TECHNICALLY
COMPETENT WORKFORCE.
3
CAPABILLITY
WORK PROCESS & METHODOLIGIES
EQUIPMENT
REPORTING & DOCUMENTATION
1. Owner Operator
Hands On Management
Technically Knowledgable
2. Strategic Partnership
Access to workforce
Competency & Capability Building
3.`Phased Growth
Ensure Safe Service Delivery
Build on existing Competency
& Capability
SUSTAINING
To sustain and grow the business Sabahan SMEs have the
opportunity to align with the future plan developments and
initiaives within Sabah and Malaysia.
1. Owner Operator
Hands On Management
Technically Knowledgable
2. Strategic Partnership
Access to workforce
Competency & Capability Building
3.`Phased Growth
Ensure Safe Service Delivery
Build on existing Competency
& Capability
UPSTREAM
Offshore Shallow Water Facility
Maintenance & Minor Fab
Marine Support
EOR/IOR
Deepwater Specialist Services
DOWNSTREAM
Contracting for Plant Construction &
Plant Maintenance & Turnarounds
Specialist & Skilled services
Logistics & Lifting
Mechanical, Electrical,
Instrumentation
Similar Developments in other oil states
Kertih IPC
PETRONAS’ Integrated Petrochemical Complex (IPC) is located within the PETRONAS Petroleum Industry Complex (PPIC)
in Kertih, Terengganue. Receiving gas feedstock from the fields offshore Terengganu, the Kertih IPC principally consists of
ethylene-based petrochemical plants. The plants located within this IPC include two ethylene crackers, a polyethylene
plant, an ethylene oxide/ethylene glycol plant, a multi-unit derivatives plant, vinyl chloride monomer/PVC plants,
ammonia/synthesis gas plants, an acetic acid plant, an aromatics complex and a low-density polyethylene plant. These
plants are owned and operated mainly on a joint venture basis with various foreign partners with the technological
expertise and experience, financial strength and market access to add value to the business.
The petrochemical plants are integrated with the common shared infrastructure facilities and other related process
plants, including PETRONAS' six gas processing plants and the Kertih Refinery at the PPIC. The IPC is supported by a
storage and distribution terminal with a throughput of approximately 2.7 million tonnes per annum (tpa). The
supporting Kertih marine facilities include six berths that can accommodate chemical tankers of up to 40,000 dead
weight tons.
Ethylene Malaysia
Ethylene (September 1995)
Polyethylene Malaysia
Polyethylene (May 1995)
Vinyl Chloride (M)
Vinyl Chloride Monomer, Polyvinyl Chloride (PVC) (March 2001)
PETRONAS Ammonia
Ammonia / Syngas (January 2001)
BP PETRONAS Acetyls
Acetic Acid (November 2000)
Aromatics Malaysia
Aromatics (July 2000)
Optimal Olefins (M)
Olefins (Second Cracker) (January 2002)
Ethylene Glycols
Ethylene Oxide, Ethylene Glycol (February 2002)
Optimal Chemicals (M)
Ethylene Derivatives (April 2002)
Petlin (M)
Low Density Polyethylene (February 2001)
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Similar Developments in other oil states
Gebeng IPC
The Gebeng Integrated Petrochemical Complex (IPC), is an integrated self-contained petrochemical complex comprising
principally of propylene-based petrochemical plants and centralised utility facilities. The plants include an acrylic
acid/acrylic esters plant, an oxo-alcohols complex, a butanediol plant, an MTBE/propylene and polypropylene plant as
well as a propane dehydrogenation plant.
In addition to the PETRONAS and its joint-venture plants, the Gebeng IPC is also host to a number of multinational
chemical companies, such as Amoco Chemicals, which owns and operates a purified terephthalic acid plant, and
Eastman Chemicals, which owns and operates a copolyester plastic resin plant.
BACKGROUND
Located 25 km from Kuantan Town and 5km from Kuantan Port.
The development programme for Gebeng Industrial Estate is based on
•
•
•
•
Industrial Estate Development Indicative Plan (1996 – 2005)
North Kuantan Development Zoning Plan
Gebeng Industrial master Plan
Petrochemical Industry Master Plan for Gebeng Industrial Estate
MTBE
Propylene (December 1992)
Propane Dehydrogenation
Propylene, Catalyst (May 2001)
Polypropylene
Polypropylene, plastic (November 1992)
BPC Acrylics Complex
Crude acrylic acid (July 2000)
BPC Oxo-Alcohols
Syngas (July 2001)
BPC Butanediol Complex
Polyurethanes & polybutylene terephthalates (January 2004)
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Similar Developments in other oil states
KSB 1982
KSB Fast facts
Kemaman Supply Base (KSB) start operation in 1982 as onshore
support base dedicated solely to service and supplies the offshore
petroleum operations.
It was specially designed and developed as a comprehensive
logistic supply base for Peninsular Malaysia’s offshore petroleum
exploration and production industries.
Location
Kemaman, Terengganu
Duration
1982-2015
Services
•Berthing quay (360 meters with a depth
of 8.0 meters which can receive 5-6
vessels at any given time) and a twin
finger jetty providing additional berthing
facilities to layup 2 additional supply
vessels.
•Rental of office spaces housed within 3
administration office blocks
•42 units general warehouses
•2 units explosive bunkers.
•Cargo Handling Equipment
Other Services
Bunkering facilities, Silos, Supply portable
water, 24h security services (Auxiliary
police), Liquid Mud Plant (LMP)
There are more than 220 petroleum supply and service companies
with varying degree of manufacturing and technical service
capacities operating at KSB.
ASB 1996
Asian Supply Base Sdn. Bhd. (ASB) is a one-stop center for logistics support center
designed specifically for the activities of exploration, development and
production of oil and gas.
Pg.
It also provides services to companies outside the oil and gas industry. The
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terminal operates 24 hours a day, 365 days a year.
Located only 6 kilometers from the town of Labuan, base covers an area of 108
acres, including 16.5 acres of yard area of the pipe.
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Pioneer Engineering
•
•
•
•
•
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Founded in 1997 and currently headquartered at the
heart of Kuala Lumpur city, Pioneer Engineering Sdn Bhd
(PESB) is a leading service provider and innovator in
Malaysia Oil & Gas industry.
Awarded of a Topside Major Maintenance contract by
ExxonMobil in 2010 for all Exxonmobil’s offshore
platforms, Talisman in Heat Exchanger Maintenance for all
offshore platforms, NDT Inspection contract by PGB &
PCSB
Headquarters in Kuala Lumpur is supported by three
strategic bases in Paka, Puchong and a workshop in
Kemaman Supply Base
PESB has an impressive track record of providing
maintenance, repair, inspection and improvement works
for Oil and Gas facilities in offshore and onshore
PESB’s asset and capabilities include Construction &
Maintenance works (Upstream & Downstream), State-ofthe-art advance NDT inspection equipment, dedicated
team for Heat Exchanger Specialized Maintenance, DOSH
certified repairer for Boiler & Unfired Pressure Vessel,
Experienced and competent technical staff and Project
execution from subcontract to full turnkey
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We h a y a R e g e l u n g S d n B h d
•
•
•
•
WEHAYA Group comprises of several entities, each focused in a specialised and individual core area of
expertise, ranging from mechanical, electrical and instrumentation installation to full system from
diverse industries such as oil & gas, chemical & petrochemical, waste & water treatment, construction
materials and other industries.
Focused in a specialised and individual core area of expertise; ranging from mechanical, electrical and
instrumentation installation to full system integration.
Founded in 1990, Wehaya has emerged as a trusted and reliable partner to our customers. Our
management team consists of qualified engineers with wide-ranging industry experience spanning 10
to 20 years
Participated in more than 100 projects, both in Malaysia and as far afield as East Nigeria and China
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UZMA BERHAD
• Uzma was incorporated in 2000 with a vision to be a regional
leader in oil and gas upstream services. Deeply rooted in Malaysia
with operational offices in Australia, Indonesia and Thailand
• Uzma has grown with proven track records, serving more than 50
clients worldwide, delivering custom-made solutions and
exceptional values in every offering.
• As an agile geoscience, production and well service company, Uzma
provides integrated solutions to the upstream sector across
exploration, development and production operations. Uzma assists
its clients to find, connect and produce their hydrocarbon assets at
the most efficient practicable conditions.
• Uzma’s core competencies are Geoscience & Petroleum Engineering,
Manpower Consultancy, Integrated Enhanced Oil Recovery,
Reservoir Description & Laboratory, Production Operations and
Optimisation, Integrated Well Services, Oilfield Chemicals and
Management System Consultancy.
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CONCLUSIONS
1.Sabah has Oil & Gas Production Span
2.Sufficient Onshore Projects for SME Entry
3.Potential for SMEs to develop competency &
capability to go Offshore
4.Smart Partnerships to leap frog organic growth
OPPORTUNITIES AND GROWTH
IN THE OIL AND GAS INDUSTRY
IN SABAH
Day 2 Paper III:
“Sabah Oil and Gas; A Sustainable Future for Sabah SMEs”,
Dato’ Udani Bin Dato’ Seri Mohamed Daud,
Group Executive Chairman, MaxEnergy Group
GRAND BALLROOM,
THE MAGELLAN SUTERA HARBOUR RESORT
KOTA KINABALU SABAH
13th & 14th April 2015
28 January 2015
MXLT 02/2015
18