KUALA LUMPUR (Sept 21): Dialog Group Bhd (KL:DIALOG) said its RAJA Cluster small field asset production sharing contract (PSC) has received approval from Petroliam Nasional Bhd (PETRONAS) for an US$81 million (RM330.29 million) field development and abandonment plan.
In a bourse filing on Monday, Dialog said the final investment decision for the plan was approved by PETRONAS through Malaysia Petroleum Management (MPM).
The development plan follows Dialog’s subsidiary Dialog Resources Sdn Bhd’s signing of the RAJA Cluster SFA PSC with MPM in December 2024, under which Dialog holds a 100% participating interest and operatorship.
The PSC contract runs for up to 14 years, comprising a two-year pre-development phase, followed by a two-year development phase and a production period of up to 10 years.
First commercial production is targeted by the end of the development phase of up 10 years and first commercial production is targeted by the end of the development phase, which is estimated to be around end-2028.
Dialog said studies carried out during the pre-development phase, including 3D seismic data reprocessing, technical assessments and resource evaluations, supported the viability of developing the fields. The RAJA Cluster has an estimated 6.1 million stock tank barrels of proved and probable reserves.
Dialog expects to finance the project using a mix of internal funds and/or external borrowings.
The development marks Dialog’s further expansion into the upstream segment, where it already operates the Baram Junior Cluster small field assets PSC. Its core business is in the leasing of storage tanks for the oil and gas sector.
Dialog shares slipped eight sen or 3.8% to close at RM2.01 on Monday, giving the group a market value of RM11.3 billion.