Make Kitco Your Homepage

Exxon names BAML to run Malaysia asset sales: sources

Kitco News

LONDON (Reuters) - Exxon Mobil Corp has appointed Bank of America Merrill Lynch to run the sale of its Malaysian oil and gas assets as the U.S. firm accelerates a vast disposal program, banking and industry sources said.

The Malaysian assets, which include stakes in two large fields, are expected to fetch up to $3 billion, the sources said.

Exxon is exploring a sale of its Malaysian oil-and-gas producing assets, among a number of other properties worldwide, confirmed spokeswoman Julie King.

The oil major has no agreements with potential buyers for the Malaysian properties and will continue to operate the fields as it explores their sale, she said. Exxon has said it aims to sell $15 billion in assets by 2021.

Bank of America declined to comment.

Irving, Texas-based Exxon has ramped up sales of assets around the world in recent months. Those it has offered or sold include production in Norway, Australia, Nigeria, Azerbaijan and Britain.

In Malaysia, Exxon operates 35 oil and gas platforms in 12 offshore fields and has working interests in another 10 platforms in five fields in the South China Sea, according to its website.

The operations produce 15% of Malaysia’s oil output of 600,000 barrels per day and half of its natural gas output of over 2 billion cubic feet per day.

The fields are operated under a 50% and 78% stake in two large production sharing contracts (PSC), consultancy WoodMackenzie said in a note.

“The Malaysian assets are both operated and generally highly mature, with a significant amount of ageing infrastructure. A buyer will need to have strong operating credentials, and be recognised by (Malaysian national oil company) Petronas to be a suitably qualified and reputable operator,” one banker said.

Exxon, which has operated in Malaysia for more than 125 years, will continue to operate other businesses in the country after any sale. It runs two support centers in Kuala Lumpur for its upstream, fuels, lubricants and chemicals manufacturing and for information technology support. It also is a provider of polyethylene to the Malaysian market.

Reporting by Ron Bousso, Anshuman Daga and Florence Tan in Singapore and Gary McWilliams in Houston; Editing by Alexandra Hudson and Nick Zieminski

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.