KUALA LUMPUR (Dec 5): Dialog Group Bhd (KL:DIALOG) said on Thursday that it has won a contract with Petroliam Nasional Bhd (Petronas) to assume 100% participating interest and the role of operator in the RAJA Cluster small field asset production sharing contract (PSC), located offshore Peninsular Malaysia.

In the bourse filing, Dialog said its wholly owned subsidiary Dialog Resources Sdn Bhd has entered the agreement with Malaysia Petroleum Management (MPM) that would include the pre-development study, development and production of discovered resources over the full life of the RAJA Cluster SFA PSC followed by abandonment upon its expiry.

It said the 14-year contract, which commenced on Dec 2, 2024, comes with a two-year pre-development phase that allows Dialog Resources to finalise the field development plan and move into a subsequent two-year development phase.

The first commercial production expected by the end of the development phase, it said. Based on the above, this could materialise in end-2028.

The production phase will continue for the remaining 10 years or up to the expiry of the contract, whichever is earlier.

A field development and abandonment plan will be developed to determine the feasibility and commerciality of the asset and submitted to Petronas for approval, it said.

Dialog, whose core business is in the leasing of storage tank for the oil and gas sector, also has existing exposure in the upstream segment.

Its current portfolio includes a cluster of mature oil and gas fields located offshore Sarawak, East Malaysia and a series of onshore producing fields in Thailand, according to its website.

Dialog said the Raja Cluster SFA PSC includes minimum work commitment during the pre-development phase which will encompass a technical feasibility study, 3D seismic data reprocessing and specialised studies.

It also said that it will issue a subsequent announcement once the field development and abandonment plan has achieved final investment decision and received approval from Petronas.

At the time of writing, Dialog shares were up four sen or 2.2% at RM1.83, giving it a market capitalisation of RM10.33 billion. Year to date, the stock has fallen by 11.6%.