Petronas to Decide on Canadian Gas Project in 1Q

KUALA LUMPUR--Malaysia's national oil and gas company Petroliam Nasional Bhd (6033.KU), or Petronas, expects to make the final investment decision for its $32 billion Canadian gas project in the first quarter next year, an executive said Thursday.

Petronas had earlier set a year-end deadline to decide whether to kick off the export terminal project in British Columbia. The company deferred from making the decision on Dec. 4 without specifying a new timeline, citing high development costs that could go up to as much as $10 billion and a recent slump in oil prices.

"We will defer the FID to quarter one of next year," Petronas Vice President for Upstream International Sharbini Suhaili told reporters at the sidelines of a petroleum conference.

Petronas remains in talks with "two to three" unnamed investors for the project, Mr. Sharbini said, adding the plunge in oil prices, which have fallen to five-year low due to oversupply and weak global demand, hasn't deterred potential partners.

So far, Petronas has sold a 38% stake in the project to various partners, most recently a 15% stake to China Petroleum & Chemical Corp. in April. Petronas said that deal has received approval from the Chinese government. Earlier, it sold 10% stakes each to Japan Petroleum Exploration Co. and Indian Oil Corp., and 3% to Brunei National Petroleum Co.

Petronas may also divest an oil block in Mauritania and some gas assets in Cameroon if offered attractive terms, Mr. Sharbini said.

Write to Jason Ng in Kuala Lumpur at [e-mail]

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