Eni and Petronas have signed a framework agreement to establish a new jointly participated company that will oversee their combined assets in Malaysia and Indonesia.

Signed in Kuala Lumpur, the agreement outlines the creation of the new company, which will be operated as a financially self-sufficient entity.

Both parties have agreed on asset-level valuations to be contributed to the new company, leading to an equal 50:50 ownership split.

The agreement follows an exclusive memorandum of understanding (MoU) signed by the companies in February this year.

This strategic move aligns with Eni's satellite model, mirroring its upstream activities in Norway and Angola with Var Energy and Azule.

The final agreements are expected to be signed by the fourth quarter of 2025, pending completion of financial due diligence.

Eni CEO Claudio Descalzi said: “This is another significant step towards the new company that Eni and Petronas have agreed to create across Indonesia and Malaysia, generating synergy in terms of assets, expertise and financial capabilities, in a transformational model that further strengthens the huge potential of the two countries.

“The new company will have a strong regional impact on gas production, bringing additional energy, infrastructures and employment for the benefit of both Indonesia and Malaysia. The new company will also have the opportunity to further build on an amazing, combined portfolio of more than 50 TCF [trillion cubic feet] of additional, low-risk exploration potential”.

The new company is expected to deliver sustainable production of 500,000 barrels of oil equivalent per day, primarily from natural gas.

Furthermore, it will merge approximately three billion barrels of oil equivalent (bboe) of reserves and offer an additional 10bboe of potential exploration upside.

In a related development, Staatsolie has entered a production sharing contract (PSC) with Petronas and Paradise Oil Company for Block 66 in Suriname's deep offshore.

Block 66, spanning approximately 3,390km², is situated in water depths ranging from 1,000m to 2,200m.

Petronas, via its subsidiary Petronas Suriname, has acquired the exploration, development and production rights for the block through the PSC.

The company now holds an 80% participating interest and operatorship in the block, with Staatsolie's subsidiary POC holding the remaining 20%.

Petronas has committed to drilling two exploration wells in the block's promising areas during the initial exploration phase.

"Eni, Petronas partner to combine assets in Malaysia and Indonesia" was originally created and published by Offshore Technology, a GlobalData owned brand.