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Petronas slashes rig count by more than two-thirds this year

Petronas slashes rig count by more than two-thirds this year
Malaysian national oil company Petronas' results briefing last week confirmed the depressed state of the oil and gas market, with president and group ceo Wan Zulkiflee Wan Ariffin revealing a staggering drop in rig count to just 14 rigs expected to be in operation by the end of this year, from 39 at the same point last year, local media reported.

The idling of over half of its oil rigs within a year a dramatic indicator of the downturn in the oil and gas industry and will have filter down effects throughout the supply chain for the many local contractors dependent on Petronas jobs.

On deepwater projects, ceo of Upstream, Wee Yiaw Hin, said that due to the high cost of deep-sea exploration, Petronas was facing a lot of challenges now but did not immediately confirm any specific cancellations yet.

"But it is not that simple as a case of high cost versus low price (of oil). There are many factors to consider. If it’s a large exploration activity, then the unit cost would reduce and that would enhance the viability of the project. Some of our deep-sea projects may still go ahead, depending on the size of the discovery and other factors," Wee said.