Malaysia offers strategic alliance in oil and gas industry

Malaysian Prime Minister Mahathir Mohammad has offered Indonesia's state owned oil and gas company Pertamina to form a strategic alliance with Malaysia's Petronas in the oil and gas sector.

The strategic alliance between the two state oil and gas companies would not only give mutual benefits to both countries but also to the other members of the Association of Southeast Asian Nations (ASEAN).

The potential fields which could be jointly developed by the two oil and gas companies could cover not only in the oil and gas upstream sector but also in the oil and gas downstream industry including the retail service, the Malaysian prime minister said in his address at the opening of Petronas' representative office in Jakarta.

Petronas' president Hassan Marican said that the business alliance between the two oil and gas companies could bring benefits to both of them. Indonesia, with its massive gas and oil resources, offers many business potentials for the two companies to form a strategic alliance, he said.

Petronas, with overseas operations in at least 25 countries including Indonesia, has been aggressively expanding its operations in the region. The company at present produces about 200, 000 barrels of oil per day while its partner Pertamina has the capacity of producing only about 80,000 barrels per day.

According to Pertamina's president Baihaki Hakim, said that Petronas and Pertamina have established business cooperation for years.

Currently, Petronas have interest in two oil concessions in Pasemah PSC, South Sumatera, together with Medco's subsidiary Medco Energy and Ketapang PSC, East Java with Gulf Indonesia Resources, and indirectly through its affiliate, British oil and gas company Premier Oil Plc.. (*)