DNeX’s Ping UK secures three more North Sea oilfield licences

 Dagang NeXchange Bhd’s (DNeX) UK upstream oil and gas arm Ping Petroleum UK plc (Ping UK) has added three more North Sea oilfield licences to its portfolio. The new fields bring Ping UK’s portfolio in the UK Continental Shelf to a total in excess of 100 million of barrels of oil equivalent (MMboe) in the central North Sea, according to Ping Petroleum Ltd’s statement on Tuesday. DNeX indirectly owns a 90% stake in Ping Petroleum, which wholly owns Ping UK.  Two licences — License P2612 (the Glenn field) and P2626 (Hutton field) — were acquired under the UK’s 33rd licensing round, while License P2244 (the Pilot field) was secured via the acquisition of 81.25% equity in the licence from Orcadian Energy (CNS) Ltd.

Ping Petroleum said the new UK licences will remain in planning mode for the medium term, as the energy sector seeks further clarity in coming months of a potentially new fiscal environment.  “The company now plans to embark on subsurface and engineering studies to assess the best development concepts with respect to the maximum efficient rate (MER), while aligning with its energy transition strategy,” it added. Nonetheless, the three fields are expected to come to first oil soon after the projected end of the energy profits levy at end-March 2028, according to Ping Petroleum managing director Zainal Abidin Jalil.

Touching on the new fields, Zainal said the Glenn field offers the company a chance to add value to its Avalon field by adding another reservoir, enabling it to continue its strategic focus on the MER.  “Hutton provides a different challenge for us, as it is located in deeper water and a harsher environment. Further subsurface work needs to be completed prior to a high-level recovery concept being put forward,” he said, adding that this provides an opportunity for Ping Petroleum to find an innovative and environmentally cognisant solution to extract the remaining value from the field. Meanwhile, on the Pilot field, Zainal noted that Orcadian Energy, together with energy data firm TGS, had worked the subsurface of the area for several years.  

“We believe some simplification of the development concept and a phased approach can provide an economical solution,” he added.  As for its Malaysian operations, Ping Petroleum noted that it continues to progress with its three licences in Malaysia, with the “first development” expected to deliver first oil in 2025. “The company employs an outsourced model, enabling it to maintain efficiencies, while backing local service providers and fostering information exchange between its two offices,” it added.

While Ping Petroleum did not elaborate on this first development, the company was awarded two production sharing contracts (PSCs) from Petroliam Nasional Bhd (Petronas) in early 2023 under the Malaysian Bid Round 2022. One concerned the Meranti cluster located 80km offshore Kuala Terengganu, where Ping Petroleum is the operator with 60% participating interest, with Duta Marine Sdn Bhd holding the remainder.  The other PSC is for the A Cluster 290km off the coast of Miri, Sarawak, where Ping Petroleum is the operator with 70% interest, while the remaining 30% is held by Petroleum Sarawak Exploration & Production Sdn Bhd.  Meanwhile, the company in October 2023 inked a late-life asset PSC with Petronas for the Abu Cluster offshore Peninsular Malaysia.  At the noon break on Tuesday, shares in DNeX stood one sen or 2.9% lower at 33.5 sen each, valuing the group at RM1.06 billion. 

Source: theedgemalaysia.com