KUALA LUMPUR (May 9): Petroliam Nasional Bhd (Petronas) and Vietnam Oil and Gas Group (PetroVietnam) have agreed to extend their production sharing contract (PSC) for the PM3 Commercial Arrangement Area (CAA) for another 10 years till 2027.

In a joint statement from the two entities, it said the PSC for the CAA, signed on April 6, is with Talisman Malaysia Ltd, Talisman Malaysia (PM3) Ltd, Petronas Carigali Sdn Bhd and PetroVietnam Exploration Production Corp Ltd (PVEP).

Petronas said the PM3 CAA project involves offshore fields located throughout a 2,008km² area in the overlapping zone between Malaysia and Vietnam.

The contract extension will maintain the production from five producing fields — Bunga Orkid, Bunga Kekwa, Bunga Raya, Bunga Tulip and Bunga Sarojafields.

Other activities include further development of discovered fields within the Malaysia-Vietnam offshore CAA.

"Under the terms of the PSC, Talisman will continue to operate Block PM3 CAA with equity interest of 35% while PVEP will own 30% of the equity, with the remaining 35% held by PCSB," it said.

Petronas added the partners are committed to conduct near field exploration, brownfield development and studies on enhanced oil recovery at a cost of US$500 million (about RM2 billion) of additional minimum work commitment.