KUALA LUMPUR (Aug 5): Sabah Shell Petroleum Company Ltd (SSPC), a subsidiary of Shell plc, has taken a final investment decision (FID) on the third phase of the Malikai deepwater development, offshore Sabah. 

The project involves the drilling of four oil producing wells to enhance Malikai’s expected recoverable oil volumes and is part of Shell’s continued investment in Malaysia’s deepwater potential. 

This development supports Shell’s aim to sustain material liquids production of about 1.4 million barrels per day towards 2030 and beyond. 

When completed, Phase 3 is expected to increase oil production at Malikai by 60%, from around 25,000 currently to approximately 40,000 barrels per day, with production expected to begin from 3Q2028.

"The final investment decision of the Malikai Phase 3 development marks another important milestone in Shell’s long-standing commitment to Malaysia," said Siti Sulaiman, country chair of Shell Malaysia and senior vice-president upstream Malaysia, in a statement on Wednesday.

She added, "We look forward to further contributing to the state’s economic growth through investments in competitive and resilient projects". 

Siti also expressed gratitude to PETRONAS and partners for "their continued confidence and support" and said she looks forward "to building on our strong collaboration for continued success for the nation". 

Shell remains committed to supporting the country’s economic progress and energy transition efforts with competitive and resilient investments under the stewardship of Malaysia Petroleum Management, PETRONAS. 

Commissioned in 2016, Malikai is the country’s first tension leg platform (TLP) lying 100km offshore Sabah at water depths of 500 metres, and is a joint venture between SSPC and Shell Sabah Selatan Sdn Bhd (35%), ConocoPhillips Sabah Ltd (35%) and PETRONAS Carigali Sdn Bhd (30%). 

The Phase 3 development will leverage the same single combo riser technology first introduced in Malikai Phase 1 and subsequently applied in Phase 2 in 2021.