As per the deal, Talisman and Petronas Carigali will spend about $1bn for work in the Kinabalu oil fields, which comprise the Kinabalu Main, Kinabalu East and Kinabalu Far East fields that are considered to have a number of producing mature fields.
Talisman Malaysia International Operations East executive vice-president Paul Blakeley said the company has a proven track record of growing production and extending the life of mature fields, and the Kinabalu Oil Fields give it the opportunity to demonstrate this in Malaysia.
"The PSC is also adjacent to the Talisman operated Sabah exploration block, which provides additional upside in the region," he added.
Talisman will operate the contract with a 60% interest while Petronas Carigali will hold the remaining 40%.
The PSC is the first to be awarded by Petronas under a new progressive volume-based terms, designed to provide incentive to contractors to improve oil recovery and increase production from mature oil fields.
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