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Shell to shut Malaysia oilfield in July for maintenance; Kimanis exports to drop

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Royal Dutch Shell plans to carry out maintenance at an oilfield offshore Sabah in eastern Malaysia, reducing the volume of Kimanis crude exports in July, four sources said on Thursday.

[SINGAPORE] Royal Dutch Shell plans to carry out maintenance at an oilfield offshore Sabah in eastern Malaysia, reducing the volume of Kimanis crude exports in July, four sources said on Thursday.

Kimanis is Malaysia's largest export grade and the drop in shipments is expected to tighten Asian crude supplies, the four industry sources said.

Work at the Gumusut-Kakap oilfield could last for 27 days and will reduce Kimanis crude exports to three cargoes in July to early August, down from eight cargoes in June, one of the sources said.

The July work will include maintenance on Gumusut-Kakap's topside and development of a phase 2 project that is expected to add 50,000 barrels per day (bpd) of production when it hits its peak, the source said.

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Output from Gumusut-Kakap is expected to rebound to 160,000 bpd in August when works are completed, including initial barrels from phase 2, the source said. This will bring total Kimanis production to 220,000 bpd in the same month.

Shell says on its website that phase 2 is scheduled for start-up in 2019.

Shell did not respond to a request for comment.

Gumusut-Kakap is located 120 kilometres off Sabah in East Malaysia. Phase 2 is aimed at shoring up output from the field, which has been in production since 2012, the sources said.

Kimanis crude is produced from the Gumusut-Kakap and Malikai oilfields, with total output at around 190,000 bpd currently. Shell operates the two deepwater fields that lie offshore Sabah.

REUTERS