Marginal Field Economics: Investigating the Viability of Malaysian RSC Model

Development of marginal hydrocarbon fields is becoming the topic of interest among oil
and gas industry players. In Malaysia, Risk Service Contract (RSC) is used for development of
marginal fields. This paper will investigate the viability of Malaysian RSC implementation. The
objectives of this research are to conduct comparative analyses between conventional PSC and
RSC, between local RSC and foreign RSC; to evaluate current fiscal agreements for marginal
fields; and to recommend methods to improve the economics of marginal fields to atrract
investors. The scope of study of the project includes the implementation of PSC and RSC in
Malaysia, economic modeling, and competencies of local companies. The methodology used for
this project is conducting critical analysis on PSC and RSC implementation and also analyzing
the local companies’ competencies to be marginal field operators. The finding of the project
conclude that RSC implementation in Malaysia still needs further assessment and PETRONAS
should reveal more on the RSC model to allow more in-depth and research to be conducted.