PETRONAS

Exploration & Production

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 CONTENTS

ABOUT PETRONAS 2
INTEGRATED VALUE CHAIN 4
PETRONAS E&P (EP) GLOBAL PRESENCE 6
PETRONAS EP MALAYSIA OPERATIONS 8
INVESTMENT & PARTNERSHIP OPPORTUNITIES 10
EXPLORATION 12
DEVELOPMENT 16
PRODUCTION 20
UNCONVENTIONAL 24
MAKING IT POSSIBLE 26
ADVANCING TECHNOLOGY & ENGINEERING 28
PEOPLE DEVELOPMENT 32
HEALTH, SAFETY & ENVIRONMENT 36
COMMUNITIES 38
CONTACT US 40

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 ABOUT
PETRONAS
Petroliam Nasional Berhad is Malaysias fully integrated oil and gas multinational with
proven capabilities in a broad spectrum of the petroleum value chain.

Building on the success of managing Malaysias oil and gas field resources, PETRONAS
has grown into a major global oil and gas company.

PETRONAS strives to contribute to the well-being of the people and nations wherever
it operates by developing and adding value to oil and gas resources in a manner that
carefully balances commercial, environmental and social considerations.

Fortune
Global 500

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2 PETRONAS ANNUAL REPORT PE 2011
INTEGRATED VALUE CHAIN
Fully Integrated Value Chain for the Oil and Gas Industry
Crude Oil
B Refining
F Petroleum Products G Petrochemical Plant H Liquefied Petroleum I Processed Gas/
Transportation
Sector - Diesel,
Gasoline, Jet Fuel
and Lubricants
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A Exploration,
Development and Our capabilities spread across a broad
portfolio, across every stage of the oil
Production
and gas development and across the
Natural Gas
total value chain
Dato Wee Yiaw Hin
Executive Vice President
Exploration & Production, PETRONAS
As one of the worlds leading oil and gas producers, our This deep experience which spans the entire value
C Processing D Liquefaction
global operations include exploration, development and chain of the oil and gas industry has allowed us to
production of crude oil and natural gas in Malaysia and work alongside various host governments to develop
abroad; liquefaction, sale and transportation of LNG; their national Gas Masterplan, replicating the success
processing and transmission of natural gas and the sale of we have in Malaysia, to many countries abroad.
natural gas products; refining and marketing of petroleum
E Liquefied
Natural Gas (LNG) products; manufacture and sale of petrochemical Consistently, we have demonstrated that we are
products; trading of crude oil, petroleum products and good partners with host governments and other oil
petrochemical products; and shipping and logistics companies in monetising oil and gas resources.
relating to LNG, crude oil and petroleum products.
J Regasification
Industrial Sector - Gas (LPG) Peninsular Gas Terminal
Ethylene, Methanol, Residential and Utilisation (PGU) Export Sector
MTBE, Polyethylene, Commercial Sectors System
Propylene and Urea Power Sector
Industrial Sector
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 Canada

Uzbekistan
Turkmenistan
Iraq
Algeria
Egypt
Myanmar
Cuba Oman
Mauritania
Chad Sudan
Vietnam
Venezuela Sierra Leone Thailand*
South Sudan
Cameroon Malaysia Brunei

Indonesia

Australia
Mozambique

*Malaysia-
Thailand Joint
Development
Area

2012 Achievements: Global Business Dimensions:

PETRONAS EP Overall Resource Replenishment Ratio (ORRR) of 2.0x 64 partners
Global Presence 2,010 kboed of total E&P production 10,500 employees, over 50 nationalities
32 first oil and gas production : 11 greenfields and More than 50 development projects

PETRONAS Exploration & Production (EP) business carries out exploration, development and
production of oil and natural gas resources across five continents.
332
offshore


21 brownfields
546 mmboe of reserves developed


204 producing oil and gas fields
Over 300 drilled exploration and development wells
24 new discoveries 67 rigs onshore and offshore
platforms
2,077 mmboe of resource addition 19 FPSO / FSO
On the global front, we are a renowned exploration and production operator known for Total Capital Expenditure (CAPEX) of USD9.1 billion with
our resilience and distinctive capabilities in the upstream sector.
162
exploration expenditure of USD1.8 billion

PETRONAS EPs capabilities and track record of successful onshore and offshore ventures in 23
developments in the oil and gas industry have earned us reputable operatorship in many countries Our Experience in Resource Playtypes:
ventures across the world. Heavy oil Onshore High CO2 Gas
Deepwater HPHT Coal bed methane
Basement oil EOR Shale gas
Tight gas
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 This map
representing
oil and gas
activities in
Malaysia is
for illustrative Gas Fields Oil Fields
purposes only

PETRONAS EP 7787
pipeline
km 22.2 bboe
discovered resources
Malaysia Operations
Malaysia Business Dimensions and 2012
Dual Role: Resource Owner/Host Authority and Operator Achievements:
95 PSCs and 4 RSCs
As a resource owner and host authority in Malaysia, we are responsible for the effective 77 producing oil fields
management and sustainable development of the countrys oil and gas resource base. 55 producing gas fields
586 kboed liquid production
As an operator, we aim to maximise upstream value, sustain production and enhance 6,006 mmscfd natural gas production
prospectivity of the nations acreages. 22 discoveries
320 platforms
27 rigs Representation of upstream facilities in Sarawak. This schematic map is
for illustration purposes only and is not drawn to scale.

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 INVESTMENT &
PARTNERSHIP OPPORTUNITIES
Growth Opportunities For The Future, Together
Since our inception, we have attracted
large foreign investments into Malaysia,
and built strategic partnerships with
leading oil and gas contractors,
domestically and internationally.
In Malaysia, we have been successfully
developing the nations oil and gas
resources for over three decades. Despite
maturing basins and fields, we have
enhanced production, whilst increasing
the prospectivity of Malaysia acreages
through various de-risking efforts.
Indicative of abundant upstream
opportunities, the number of oil and gas
fields under exploration, development,
and in production in the country has also
risen over the years.
In an effort to continuously attract
investments, we form various partnerships
through innovative Production Sharing
Contracts (PSCs) and Risk Service
Contracts (RSCs).
100%
growth in number of 4 RSCs
PSCs in the last 8 years
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Through PSCs, our partners bear
all exploration, development, and
production costs in return for an agreed
share of production. A variety of PSC
terms are designed to encourage an
optimal level of investment based on the
complexity of petroleum resources.
RSCs were introduced in 2011 as a new
solution to attract niche partners with
the desired capability and technology to
grow our resources. In RSCs, PETRONAS
assumes the role of project owner whilst
contractors are service providers with
equity share in the RSC. Upfront capital
investment by the contractors will be
recovered upon production, together
with a fixed fee for services rendered,
based on their performance, relevant
to the development execution and
subsequent production.
Malaysia presents a host of investment
opportunities as it offers a strategic
location, modern infrastructure, reliable
transport networks, political and fiscal
stabilities, among others.
95 PSCs
320
platforms
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 EXPLORATION
Maximising Resources For Growth

We are exploring 35 basins in over 18 countries worldwide, across various operating

environments including shallow water, deepwater, deserts, swamps and lightly
inhabited areas.

On the domestic front, the deep basin knowledge gathered over the years, coupled
with innovative technology applications have made Malaysia a top country in the
region in terms of exploration success.

These include opportunities in new basins and countries which provide materiality,
through the application of new technologies.
Worlds first 3D Broadband Circular Shooting Survey
Worlds first 3D Constant Gradient Slant Streamer Survey
Joint development of the first High Power Shallow Water surface towed CSEM
source
First Airborne Full Tensor Gradiometry Survey
3D Full Wave Seismic for imaging through gas cloud

In the international arena, we continue to high grade the quality of our exploration
assets. In countries that we are already producing, we focus on organic and value
growth through both near fields and new plays exploration.

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 Standout
performer 24
discoveries in 2012:
6 tscf
of hydrocarbon resource in Kasawari
Malaysia contributed 72% of total
22 in Malaysia, 2 in International field, largest non-associated gas
upstream exploration discoveries
discovery in Malaysia
with 1.4 billion boe in Southeast Asia
in 2012

HPHT vertical wells in Malaysia - 4,830 metres depth with
12 gas bearing reservoirs
Basement oil play Vietnam, Malaysia
Deepwater exploration Mozambique, Egypt, Cuba,
Mauritania, Brunei, Malaysia
HPHT exploration Egypt, Malaysia, Turkmenistan
Tight gas Oman
Carbonates exploration Malaysia, Indonesia
Precarbonates Malaysia

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 DEVELOPMENT
Delivering Excellence

Superior Project Management

PETRONAS EPs Project Management System is a structured approach to; ensuring
project delivery is safe, cost effective and competitive. Regardless of project complexities,
we comply with stringent Health, Safety and Environment (HSE) standards, PETRONAS
technical standards and global best practices.

Innovative Project Delivery

PETRONAS EP employs innovative workflow and processes for effective development
design and planning. These efforts have earned us significant cost savings, enabled
projects to be delivered ahead of time, while providing a greater return on investment.

World Worlds Worlds heaviest

record
Sepat oil Phase 1 achieved
first External turret Floating
Production Storage
Platform construction at
Gumusut Kakap, Sabah,
Pilot implementation of Offloading (FPSO) First Malaysia
1st hydrocarbon within 12
a refurbished wellhead Deepwater field employing
months. Substantially faster
platform concept at D21, a the first Truss Spar Floating
than industry average of 28
marginal field in Malaysia Production Unit outside the
months. IPA Benchmark
Gulf of Mexico

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 First 91%
quartile performance for project Projects delivered within
development schedule, IPA budget in 2012
Benchmark in 2012

Worlds first use of composite bridge plug system for Kanowit: Malaysias first subsea well with a potential of
production testing purposes in Kuang North field, Malaysia producing 100 mmscfd from each well
Borneos longest: Sabah-Sarawak Gas Pipeline (SSGP) of
more than 500 km to transport offshore natural gas to
processing terminals

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 PRODUCTION
Optimising Growth

Converting Maturing Brownfields

PETRONAS EP has implemented various brownfield rejuvenation efforts, effectively
extending the production life of oil and gas fields with Improved Oil Recovery (IOR),
Improved Gas Recovery (IGR) and Infill Drilling technologies.

Through innovative strategic alliances with international contractors, we have repeatedly

improved a reservoirs recovery factor and asset integrity, whilst arresting declining
production in domestic and international fields.

EOR
83 mmstb of oil
24
IOR/EOR/
32
first oil and gas
Overall
Equipment Excellence
identified as additional IGR production production in 2012 (OEE) of platform
reserves in Malaysia enhancement projects from Malaysia performance in Malaysia
through EOR activities underway and international for oil 92.6% and Gas
operations 96.1% in 2012

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 Enhancing Yields with Innovative Technologies
New developments in deepwater exploration and production, Carbon Dioxide (CO2)
management technologies and High Pressure High Temperature (HPHT) technologies
have opened up new opportunities for growth and monetisation.

E&P Total Production

Baram Delta Production Levels: Enhancing Yields in 000 boe per day

3.5%

A matured oil field considered

commercially non-viable was revived
in 1971 through vigorous production
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 The outlook for PETRONAS production
enhancement activities. Today, after and resource addition is a healthy 3.5%
40 years, the oil field is still producing Compound Annual Growth Rate (CAGR)
at its optimum rate. over a period of ten years

1971 2011

Turkmenistan - fully operational to support future gas Higher yields: 440 mmscfd of raw high CO2 gas at
production increase at the capacity of 500 mmscfd Tangga Barat cluster fields, first application of membrane
Mauritania Chinguetti field - one of the producing assets type CO2 removal technology
in Mauritania with a reserve volume of 11,652 kbbl

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 UNCONVENTIONAL
Venturing Into New Frontiers
PETRONAS accelerates upstream growth
by venturing into new frontiers with
unconventional gas through strategic
acquisitions and partnerships with leading
oil and gas operators.
A joint venture between PETRONAS and
Santos in Australia allows us to develop
one of the worlds first Coal Bed Methane
(CBM) into an LNG processing facility
with a 450 km pipeline.
Coal bed methane GLNG
PETRONAS embarks on one of the worlds first CBM to LNG projects with 7.8
MTPA (onstream target 2015) at Queensland, Australia
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In 2012, Progress Energy Canada Ltd
(PECL) was acquired by PETRONAS,
bringing in over 1,100,000 acres of
Montney rights in Alberta and British
Columbia, with over 200 tcf of gas
in place.
With this, our Overall Resource
Replenishment (ORRR) increased to 3.5x
with an improved resource addition of
5,621 mmboe.
Shale gas
200 tcf gas in place at
Montney Shale, Canada
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 PETRONAS
facilities &
hydrocarbon plays

Shallow water Deepwater Ultra-Deepwater

Coalbed Conventional
methane associated
gas

Conventional
non-associated
gas Tight Oil
Sandstone sand gas

Gas-rich shale

Today, we are amongst the worlds first in maximising recovery of discovered fields with

MAKING IT POSSIBLE Enhanced Oil Recovery (EOR) efforts.

PETRONAS EPs Strength And Capabilities
We have explored some of the worlds most challenging terrains to secure new reserves.
Additionally, we conduct deepwater exploration, entering also into highly complex HPHT
reservoirs and wells with high CO2 content to enhance our yields.
Cutting-edge technologies are applied alongside new strategies to rejuvenate
brownfields, extracting maximum value from existing reservoirs.
In consistently delivering some of the worlds first - pipelines, platforms and projects,
we have brought oil and gas onstream ahead of schedule - providing rapid return on
investment for our partners, stakeholders and investors.

Our growth portfolio includes unconventional oil and gas - which include shale gas and
Our Experience in Resource Playtypes
coal bed methane.
Heavy oil Onshore High CO2 Gas

Deepwater HPHT Coal bed methane
Basement oil EOR Shale gas
Tight gas

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 To provide new picture

ADVANCING TECHNOLOGY
& ENGINEERING
Development And Deployment Of Technologies

PETRONAS E&P Technology Division

Within the PETRONAS E&P Technology Division is the E&P Technology Centre which
seamlessly integrates Research and Development (R&D), Field Development Plan (FDP)
and technology deployment to accelerate the development and production of EOR and
high CO2 gas fields.

Patented Technologies
PETRONAS has commercialised some of its patented technologies to improve
production yields, enhance operational efficiency and deliver exacting results. From
CO2 removal membranes to solids removal and Water Alternate Gas (WAG) oil recovery
methods, we continue to make breakthroughs in technology and engineering.

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 PETRONAS Patented Technologies

SolidClenz iCON
A custom-formulation to remove organic and inorganic A steady-state and dynamic process simulaton software
solid deposits in production well tubings and well bores for the enhancement of operational performance, design
for improved Return On Investment (ROI) on chemical and process optimisation.
treatment.
PN-1 Multi-Layer Membrane
PN1 membrane improves
separation efficiency by using
properties of multiple membrane
PIPEASSURE fiber.
A pre-impregnated composite resin system for
onshore and offshore pipeline repairs. A cost-effective
corrosion protection technology that requires little or
no operation shutdown. A JEC Asia Innovation 2012
award winner.

SmartCen
An online real-time metering supervisory system
designed for all metering operations which support
centralised data for remote monitoring, diagnostics and
analysis.

273
patents filed
40% CO2 440 mmscfd
reduction in removal technology - of raw high CO2
by PETRONAS CAPEX for Reduced CO2 blend to gas at Tangga Barat
development 8 mol% compared to cluster fields, Malaysia,
of high CO2 initial blend of 37 mol% first application of
content gas membrane type CO2
fields removal technology

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 PEOPLE DEVELOPMENT
Ensuring A Sustainable And Skilled Talent Stream

People are the driving force of our business. For every hour we put out in
the field, we spend hundreds more in training and development. We provide
structured capability development programmes to upskill our diverse talent
stream across geographical boundaries.

Advancing Technical Capabilities

We have developed strong partnerships with our learning partners which
include Institut Teknologi Petroleum PETRONAS (INSTEP), PETRONAS
Leadership Centre (PLC), Universiti Teknologi PETRONAS (UTP) and
Malaysian Maritime Academy (ALAM) to advance our technical capabilities.

The PETRONAS upstream live plant located at INSTEP offers our engineers
and technicians hands-on experience in a simulated EP environment.

Through our collaborations with service companies, contractors and joint

venture partners, we provide on-the-job training programmes to heighten
our employees skills and expertise for superior performance and delivery.

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 EP CAPABILITY DEVELOPMENT FRAMEWORK

N
ARBO
D ROC ORK
HY MEW
NAL FRA
O V .
TI DE
EN ITY
PA V
L

Build EP capabilities
CA ON
BI

in unconventional Develop
C
UN

hydrocarbon field competent and

development capable geoscientists
contributing to
business targets
Provide broader
S COMPE
knowledge for drilling
OUP TE
engineers to R E R
NC
ICAL KILL G

D S
understand and better
Y DE ELOPM
L E A

H I P

appreciate other
Develop wholesome
S

HSE
V
disciplines and
petroleum engineers
divisions
with better
HN

EN
TE
C T appreciation of EP
value chain

Develop and sustain

EP production Enhance project
operations capability management
in meeting operational capability to improve
excellence targets project performance
and delivery

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 HEALTH, SAFETY & ENVIRONMENT
Committed To HSE Excellence

Stringent HSE management practices, in line with international standards and best
practices, are applied at every level of our business activities to safeguard our people,
environment, assets and reputation. In doing so, we are focused on having the right
leadership, commitment, culture, mindset, systems and tools.

6.7 million
safe manhours without LTI:
6.5 million
safe manhours without LTI:
4.5 million
safe manhours without LTI:
Angsi platform, Malaysia Miri Crude Oil Terminal, Malaysia Myanmar

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 COMMUNITIES
Committed To HSE Excellence
Communities and Capability Building
We actively undertake community
projects in countries where we operate,
adding value to the local skills and
capabilities of the people towards long
term sustainable growth.
SUDAN: Debate and quiz competition for secondary
school and university students Annual scholarship
programme for top 100 achievers
SOUTH SUDAN: Refurbishment of Rejaf educational
centre for the blind: 15 Braille machines, 250 slates, stylus
and 200 folded cranes
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We work closely with local governments
to provide basic needs such as safe
drinking water, shelter and healthcare.
Additionally, we embark on social,
environment, education and community
projects.
MALAYSIA: Refurbishment and upgrade of existing
longhouses at Uma Akeh Miri Supply of building
materials for 7 small settlements within Sg Adang Territory,
Limbang Provided 24 water tanks to Ladang Paroh
Village, Bintulu to improve water supply
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 For further information, please contact:

Corporate Affairs & Administration

PETRONAS Exploration & Production
Level 24, Tower 1, PETRONAS Twin Towers
Kuala Lumpur City Center, 50088 Kuala Lumpur, Malaysia
Tel: +603 2051 5000 Fax: +603 2026 5050
www.petronas.com

Please visit our Corporate Website for more information on our

other businesses and related subsidiaries.

Glossary of Terms
boe barrels of oil equivalent
CSEM Control Source Electro-Magnetic
EOR Enhanced Oil Recovery
FDP Field Development Plan
FPSO Floating Production Storage Offloading
FSO Floating Storage Offloading
kbbl thousand barrels of oil
kboed thousand barrels of oil equivalent per day
km kilometres
LTI Loss Time Injury
mmboe million barrels of oil equivalent
mmboed million barrels of oil equivalent per day
mmscf million standard cubic feet
mmscfd million standard cubic feet per day
mmstb million stock tank barrels
MTPA Million Tonne Per Annum
OEE Overall Equipment Excellence
ORRR Overall Resource Replenishment Ratio
tscf trillion standard cubic feet

2013 PETROLIAM NASIONAL BERHAD (PETRONAS)

All rights reserved. PETRONAS makes no representation or warranty, whether expressed or implied, as to the accuracy or completeness of the facts presented.
PETRONAS disclaims responsibility from any liability arising out of reliance on the contents of this publication. All data represented are as at end December 2012.

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 www.petronas.com

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