KOTA KINABALU (Feb 18): The Sabah Government, through its wholly owned company SMJ Energy Sdn Bhd, maintains its strong momentum in the new year with the signing of two agreements involving Exploration Blocks SB306A and SB306B, offshore Sabah’s East Coast.

With the signing of the agreements, SMJ Energy has secured a 15% participating right in both blocks, comprising a 7.5% free carry right from INPEX and a 7.5% Back-In right from Petronas Carigali Sdn Bhd.

SB306A is operated by INPEX, holding 50 percent Participating Interest (PI) while Petronas Carigali Sdn Bhd (PCSB) holds 42.5 percent PI and SMJ Energy with 7.5 percent PI. For SB306B, PCSB serves as the operator with a 50 percent PI, with INPEX holding 42.5 percent PI and SMJ Energy holds 7.5 percent PI.

Under the Free Carry and Back-In arrangement, SMJ Energy does not carry exploration risks and will decide whether to exercise the participation rights subject to exploration success and other commercial considerations.

At the Malaysia Bidding Round 2024 (MBR2024) Award Signing Ceremony held at the Kuala Lumpur Convention Center on Monday, Dr Dionysia Kibat, CEO of SMJ Energy, signed the Production Sharing Contract for Block SB306A and SB306B, with representatives from Petronas, PCSB and INPEX.

The event marks SMJ Energy’s additional exploration deals in Sabah. The first Back-In right was signed on 15 February 2023 for Exploration Block SB409, and the second Back-In right was signed on 23 January 2024 for Exploration Block SB403, both located offshore West Coast Sabah.

SMJ Energy also holds a 50 percent participating Interest in the Samarang PSC Joint Venture, 25 percent interest in SAMUR petchem plant and 10 percent interest in Petronas LNG9 Sdn Bhd. It also owns 100 percent of Sabah International Petroleum, which is now debt-free, generating strong cash flow from its FPSO (Floating Production Storage and Offloading) and FSO (Floating Storage Unit) operations.

SMJ Energy was set up on 10 November 2021 and declared RM110 million dividends in total for 2023 and 2024.