KUALA LUMPUR (June 13): Dialog Group Bhd (KL:DIALOG) has secured the asset production sharing contract (PSC) for the Mutiara Cluster Small Field located off the coast of Sabah from Petroliam Nasional Bhd (Petronas).

The 14-year contract designates Dialog's wholly-owned Dialog Resources Sdn Bhd as the sole operator with a 100% participating interest in the Mutiara Cluster, which comprises five fields — Nymphe, Nymphe North, Kuda Terbang, Benrinnes and Mutiara Hitam — according to Petronas in a statement on Friday (June 13).

The Mutiara Cluster is the first PSC awarded by Petronas, through Malaysia Petroleum Management (MPM), under the Malaysia Bid Round 2025 (MBR 2025), and is expected to achieve first production in 2029. The contract was signed on Friday.

The small field asset PSC is envisioned as a catalyst to open up the Sandakan Basin for further exploration and increase local participation in line with Petronas’ aspiration to enhance Malaysia’s position as an attractive upstream investment destination, said the state-owned oil and gas company.

According to Dialog in a bourse filing, the contract involves a two-year pre-development phase that allows its unit to finalise the field development plan, before moving into a subsequent two-year development phase, with first commercial production expected by the end of the development phase.

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

“Participation in the Mutiara Cluster SFA PSC complements Dialog’s strategy to continue to expand and diversify across the energy sector, thereby increasing opportunities for synergies within Dialog Group including provision of services in the value chain of the field development cycle. 

"This is expected to create a robust platform for generating long-term sustainable revenue from oil and gas production, reinforcing Dialog's position as a leading integrated technical service provider,” Dialog said.

Dialog will announce further updates once a final investment decision (FID) is reached and Petronas' approval is obtained.

Dialog's core business is in the leasing of storage tanks for the oil and gas sector. Its exposure to the upstream segment 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.

Shares of Dialog closed six sen or 3.97% higher at RM1.57 on Friday, giving it a market capitalisation of RM8.49 billion.