Argus Media reported yesterday that Petronas operates the Gharraf oil field, a joint venture in which Petronas owns a 45% stake, together with Japan Petroleum Exploration Co Ltd (30%) and Iraqi state-owned North Oil Co (25%).

Output from Gharraf was halted in mid-March in response to the Covid-19 pandemic, restarting in July at a rate of 50,000 barrels a day, down from the 90,000 to 100,000 barrels a day produced in 2019.

“Under the US$40/barrel scenario, I’d be the first to admit that under all possible lenses, we’ve had to trigger a review of our intent to stay in Gharraf,” said Tengku Muhammad Taufik Aziz, Petronas president and group CEO.

“We are in consultation with the host authorities to see whether the (oil field’s) economics can be improved but, of course, over and above that, we need to make sure it makes sense from the sustainability lens as well.

“If we can make it (the oil field) better, cleaner, we’ll still pursue it,” he said.

Tengku Taufik said Petronas’ role as the custodian of Malaysia’s oil and gas resources required it to look at its portfolio through a “strict and regimented” lens.

This meant that projects would need long-term resilience in a US$40 a barrel scenario and to be more ecologically friendly to meet demands by stakeholders and customers.

Reuters reported that crude oil prices rose slightly in early trade today after data showed US crude stockpiles fell last week, adding to 2% gains overnight after the Organization of the Petroleum Exporting Countries (Opec) and its allies were seen fully complying in September with their pact to curb output.

US West Texas Intermediate crude futures picked up four cents, or 0.1%, to US$41.08 a barrel as of this morning, while Brent crude futures rose five cents, or 0.1%, to US$43.37 a barrel.