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Petroleum Geoscience
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Abd Rasid Jaapar is the President of Geological Society of Malaysia (GSM), which was founded in 1967 with the aim of promoting the advancement of the earth sciences in Malaysia and the Southeast Asian (S.E.A) region. Abd Rasid is also the Managing Director of Geomapping Technology Sdn Bhd, and Chief Operating Officer for OST Slope Protection Engineering (M) Sdn Bhd.

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Abd Rasid Jaapar, GSM President


  1. You’re someone who has put on many professional hats – you’re the Managing Director of Geomapping Technology Sdn Bhd, President of Geology Society of Malaysia, and you’re also the COO of Slope Protection Engineering Sdn Mhd. How do you find the passion to keep going in this industry? What keeps you motivated?
    First, of course my family. You need to keep going because of them. Second, I truly enjoy what I do. If you enjoy your work, everything else will fall into place. When we work for money, we will get money but when we work for something we love, we will feel great and the money will come to you more easily.

  2. As an industry expert, you have had considerable experience in the field of geotechnical engineering, environmental geology, and hydrogeology from onshore to offshore. For someone who’s just beginning their career in the industry, what advice can you give him or her? How do you keep elevating or improving yourself if you want to stay ahead of the game?
    If you are serious in building your career, try to start with a smaller company. Being a contractor is your best bet because in a small contracting company, you will learn a lot about the different aspects of various jobs in the company. After 2 to 3 years, you can move on to a consulting company where you learn to analyse and interpret the data that you have. After a couple more years, take a break to pursue your second degree to specialise in a specific field of geology that you’re interested in. By then you should be mature enough to decide where you want to be in the next phase of your career. Join a big corporation, create your own business or teach in a university? With the experiences and additional degree that you have acquired, the sky is the limit!

  3.  Have you faced any obstacles or challenges in your career? What did you learn from overcoming these challenges?
    The biggest challenge is communication especially with other professionals. I had the opportunity to work in construction as well as oil & gas industries. In the construction industry, geologist functions are limited with perhaps lower pay compared to other professionals. It is different in the oil & gas industry, where almost every professional is equally respected with specific functions.

    Over the years, I realised that we are paid for what we can do, not for who we are. If you are good at what you do, no matter who you are, you will be rewarded. I think the co-curriculum activities that I was involved in during secondary school and university helped me a lot in developing my soft skills; communications, management, leadership, etc. Just be excellent in what you do, not only as a geologist but as a geologist who can communicate knowledge well to others.

  4. I’m sure you have travelled to many different countries and places in your line of work. Can you share what was the most memorable work experience you had in the foreign land that was so different from Malaysia?
    Every country has different cultures and challenges. In Indonesia, sometimes we have to organise a ‘feast’ with the locals to ensure that our work will not face any obstacles. In one occasion, we had to do a ‘sacrificial ceremony’ to the Goddess of Sea, Nyi Roro Kidul following local customs. Like it or not, we have to adapt to the culture.

    The biggest challenge was to complete the work in Caspian Sea in Turkmenistan territory in 2009-2010. The preparation and mobilisation had to be done from Baku, Azerbaijan due to logistics and political issues. At that time, Azerbaijan and Turkmenistan were not in good terms, politically. Managing third parties in between Azerbaijan and Turkmenistan was very challenging indeed. In the end, we managed to complete the work albeit with a month’s delay.

  5. Is there a future in Geology in the energy industry? How do you think the industry will fare in the next 10-20 years? 
    Yes, of course. History repeats itself, and so will the fluctuation of oil price. It is a cycle indeed. I believe we have enjoyed the longest period of good and stable oil price in history before the crisis. The challenges will still be in exploration in deep water and marginal fields. I am certain that the industry will react by coming up with new methods or technologies suited to operate at a much lower operating cost.

  6. There have been recent articles claiming millennials do not find working in the energy, oil and gas industry attractive. How do you think we can keep millennials interested in the field?
    After the downfall of oil price in 2015, the situation faced in almost every oil & gas related company was indeed terrifying. Many employees were dismissed abruptly. Employees felt discouraged as they were once the heroes in the company but suddenly they were left without jobs. The workforce in oil, gas and energy was severely impacted and the industry will eventually need to scour for newcomers and train them from scratch.

    To attract graduates, the industry as a whole needs to work harder in terms of promoting jobs, perhaps looking at more targeted ways of acquiring new talents. The salary range needs to be reasonable. And as mentioned, more training needs to be done to prepare the fresh graduates for their careers. We need to show that the industry cares for the workforce. Over time, I believe that the market will recover and the oil, gas and energy industry will thrive again.

  7. You are a prominent figure in the industry, and many look up to you. Has your professional network been important in getting you where you are today? Also, other than the workplace, where should one start building their professional network?
    Yes, networking is important in business and professional development. Again, it must start with communication. Through good communication, you are building your network of connections. We must be open minded and take the opportunity to connect with everybody. In professional and business life, there are no enemies per se, only competitors. One day, the competitors may become your strategic allies. You must always be respectful of others. Professionals need to get involved with professional development programs such as seminars, conferences, trainings, etc. Professional and learned associations help in networking so you should become a member of any of these organisations. The alumni association of your alma mater can also be a good networking place.

  8. Do you feel that youths today have more opportunities given global connectivity? How do you think they should capitalize on this?
    Yes. With technology, the opportunities are endless. Don’t underestimate the youths. They are creative and look at things differently. We are in a borderless world now, so to speak, so for those who are innovative and can create trends will succeed almost instantly and youngsters should capitalise on this.

  9. Is there anything else that is on your bucket list or goals you want to achieve in your life/career?
    For me, I just want to see all my kids excel in their life. In the professional realm, I want to see the Geologist Act 2008 really give impact to enhance the professionalism and profile of all geologists in Malaysia. I also want to see my field of expertise in geology, i.e. engineering geology, being practiced the best it can to its fullest potential in the country.

  10. We all know what they say about all work and no play. What do you enjoy doing in your free time?
    With friends at this age, I enjoy playing golf or futsal or just having Teh Tarik, discussing about politics, our children’s future and what men like to discuss the most…every man knows…ha ha ha!
    With family, I love to spend time traveling with them. I enjoy strengthening our family bond through travelling.

  11. If you were not doing what you’re doing now, what do you think you would have become?

    Lecturer, motivator or maybe event organiser.


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Indonesia’s Abadi LNG Project Sees Movement

It has been 21 years since Japanese upstream firm Inpex signed on to explore the Masela block in Indonesia in 1998 and 19 years since the discovery of the giant Abadi natural gas field in 2000. In that time, Inpex’s Ichthys field in Australia was discovered, exploited and started LNG production last year, delivering its first commercial cargo just a few months ago. Meanwhile, the abundant gas in the Abadi field close to the Australia-Indonesia border has remained under the waves. Until recently, that is, when Inpex had finally reached a new deal with the Indonesian government to revive the stalled project and move ahead with a development plan.

This could have come much earlier. Much, much earlier. Inpex had submitted its first development plan for Abadi in 2010, encompassing a Floating LNG project with an initial capacity of 2.5 million tons per annum. As the size of recoverable reserves at Abadi increased, the development plan was revised upwards – tripling the planned capacity of the FLNG project to be located in the Arafura Sea to 7.5 million tons per annum. But at that point, Indonesia had just undergone a crucial election and moods had changed. In April 2016, the Indonesian government essentially told Inpex to go back to the drawing board to develop Abadi, directing them to shift from a floating processing solution to an onshore one, which would provide more employment opportunities. The onshore option had been rejected initially by Inpex in 2010, given that the nearest Indonesian land is almost 100km north of the field. But with Indonesia keen to boost activity in its upstream sector, the onshore mandate arrived firmly. And now, after 3 years of extended evaluation, Inpex has delivered its new development plan.

The new plan encompasses an onshore LNG plant with a total production capacity of 9.5 million tons per annum. With an estimated cost of US$18-20 billion, it will be the single largest investment in Indonesia and one of the largest LNG plants operated by a Japanese firm. FID is expected within 3 years, with a tentative target operational timeline of the late 2020s. LNG output will be targeted at Japan’s massive market, but also growing demand centres such as China. But Abadi will be entering into a far more crowded field that it would have if initial plans had gone ahead in 2010; with US Gulf Coast LNG producers furiously constructing at the moment and mega-LNG projects in Australia, Canada and Russia beating Abadi’s current timeline, Abadi will have a tougher fight for market share when it starts operations. The demand will be there, but the huge rise in the level of supplies will dilute potential profits.

It is a risk worth taking, at least according to Inpex and its partner Shell, which owns the remaining 35% of the Abadi gas field. But development of Abadi will be more important to Indonesia. Faced with a challenging natural gas environment – output from the Bontang, Tangguh and Badak LNG plants will soon begin their decline phase, while the huge potential of the East Natuna gas field is complicated by its composition of sour gas – Indonesia sees Abadi as a way of getting its gas ship back on track. Abadi is one of Indonesia’s few remaining large natural gas discoveries with a high potential commercialisation opportunities. The new agreement with Inpex extends the firm’s licence to operate the Masela field by 27 years to 2055 with the 150 mscf pipeline and the onshore plant expected to be completed by 2027. It might be too late by then to reverse Indonesia’s chronic natural gas and LNG production decline, but to Indonesia, at least some progress is better than none.

The Abadi LNG Project:

  • Reserves: 10 tcf of natural gas
  • Field: Estimated production of 1.2 bcf/d gas and 24,000 b/d condensate for 24 years
  • Operations: Inpex (65%), Royal Dutch Shell (35%)
  • LNG Plant: 9.5 mtpa capacity, estimated start date in 2027
June, 18 2019
Your Weekly Update: 10 - 14 June 2019

Market Watch

Headline crude prices for the week beginning 10 June 2019 – Brent: US$62/b; WTI: US$53/b

  • With US’s trade and tariff assault abating for the moment, crude oil prices have consolidated their trends to steady up as OPEC+ nations signal their desire to continue stabilising the oil market ahead of a June 25 meeting in Vienna
  • Despite some background squabbles between Russia and Saudi Arabia – with Russia at pains to emphasise its position regarding lower oil prices – the group has seemingly come together
  • Saudi Arabia has reportedly corralled the OPEC group to agreeing to extending the current supply deal to December, even Iran, but convincing Russia has been a harder task and adherence may continue to be an issue
  • Meanwhile, the US continues to tighten the screws on Venezuela and Iran, announcing sanctions on Iranian petrochemicals exports and targeting Venezuela’s trade in diluents that are used to blend heavy crude down
  • With reports that Iranian crude exports were down to an estimated 400 kb/d in May, tensions in the Persian Gulf continue with the latest incident being attacks on tankers; this risk factor will lift the floor for oil prices for now
  • After a brief rise last week, American drillers dropped 11 oil rigs but added 2 gas rigs according to Baker Hughes for a net loss of 9 active sites, bringing the total active rig count down to 975
  • As OPEC prepares to meet, the market has seemingly locked in an extension of the supply deal into projections, which will leave little room for gains; expect Brent to fall to the US$60-62/b range and WTI to trade at US$51-53/b

Headlines of the week

Upstream

  • BP is selling its stakes in its Egyptian concessions in the Gulf of Suez to Dubai-based Dragon Oil (a subsidiary of ENOC), which do not include BP’s core production assets in the West Nile Delta production area
  • Eni’s African streak continues with its fifth oil discovery in Angola’s Block 15/06 at the Agidigbo prospect, bringing total resources to 1.8 billion barrels
  • Also in Angola, ExxonMobil and its partners are looking to invest further in offshore Block 15 that will see Sonangol take a 10% interest in the PSA
  • Russia’s Lukoil has inked a deal with New Age M12 Holding to acquire a 25% interest in the offshore Marine XII licence in the Republic of Congo for US$800 million, covering the producing Nene and Litchendjili fields
  • Buoyed by recent discoveries in the Caribbean, the Dominican Republic is launching its first licensing round in July, offering 14 blocks in the onshore Cibao, Enriquillo and Azua basins and the offshore San Pedro basin
  • W&T Offshore and Kosmos Energy have struck oil in the Gladden Deep well in the US Gulf of Mexico, the first of a four-well programme that includes the Moneypenny, Oldfield and Resolution prospects with estimates of 7 mmboe

Midstream & Downstream

  • Shell is increasing storage capacity at its Pulau Bukom refinery in Singapore, adding two new crude oil tanks to increase capacity by nearly 1.3 million barrels
  • A new swathe of American sanctions against Iran is now targeting Iranian petrochemical exports, clipping a major regional revenue source for Iran
  • Angola is looking overhaul its refining sector, by attracting investment o overhaul facilities and building a new refinery in Soyo that will be the third ongoing refining project after the 200 kb/d Lobito and Cabinda plants
  • BP and Mexico’s IEnova have signed a deal allowing BP to use IEnova’s new gasoline and diesel storage and distribution facilities in Manzanillo and Guadalajara, allowing access to over 1 million barrels of storage
  • British petrochemicals firm INEOS has announced plans to invest US$2 billion in building three new petchem plants in Saudi Arabia that would form part of the wider Saudi Aramco-Total Project Amiral petrochemicals complex
  • The saga of Russia’s bankrupt 180 kb/d Antipinsky refinery continues, with SOCAR Energoresurs (a JV including Sberbank) acquiring an 80% stake in the refinery with the aim of restarting operations
  • Mexico has kicked off construction of its US$7.7 billion oil refinery, aimed to overhauling the Mexican refining industry after years of underperformance

Natural Gas/LNG

  • Toshiba is exiting the Freeport LNG project in Texas, paying Total US$815 million and handing over its 20-year liquefaction rights by March 2020
  • China’s CNOOC has officially acquired a 10% stake in the Arctic LNG 2 project by Novatek, solidifying natural gas ties between Russia and China
  • Cheniere has taken FID to add a sixth liquefaction train to its Sabine Pass export project in Lousiaina, which would add 4.5 mtpa of capacity to the plant
  • Novatek, Sinopec and Gazprombank have created a China-focused joint venture to market LNG and natural gas from Novatek’s Arctic projects in China
June, 17 2019
Upcoming OPEC Meeting: What to Expect

A month ago, crude oil prices were riding a wave, comfortably trading in the mid-US$70/b range and trending towards the US$80 mark as the oil world fretted about the expiration of US waivers on Iranian crude exports. Talk among OPEC members ahead of the crucial June 25 meeting of OPEC and its OPEC+ allies in Vienna turned to winding down its own supply deal.

That narrative has now changed. With Russian Finance Minister Anton Siluanov suggesting that there was a risk that oil prices could fall as low as US$30/b and the Saudi Arabia-Russia alliance preparing for a US$40/b oil scenario, it looks more and more likely that the production deal will be extended to the end of 2019. This was already discussed in a pre-conference meeting in April where Saudi Arabia appeared to have swayed a recalcitrant Russia into provisionally extending the deal, even if Russia itself wasn’t in adherence.

That the suggestion that oil prices were heading for a drastic drop was coming from Russia is an eye-opener. The major oil producer has been dragging its feet over meeting its commitments on the current supply deal; it was seen as capitalising on Saudi Arabia and its close allies’ pullback over February and March. That Russia eventually reached adherence in May was not through intention but accident – contamination of crude at the major Druzhba pipeline which caused a high ripple effect across European refineries surrounding the Baltic. Russia also is shielded from low crude prices due its diversified economy – the Russian budget uses US$40/b oil prices as a baseline, while Saudi Arabia needs a far higher US$85/b to balance its books. It is quite evident why Saudi Arabia has already seemingly whipped OPEC into extending the production deal beyond June. Russia has been far more reserved – perhaps worried about US crude encroaching on its market share – but Energy Minister Alexander Novak and the government is now seemingly onboard.

Part of this has to do with the macroeconomic environment. With the US extending its trade fracas with China and opening up several new fronts (with Mexico, India and Turkey, even if the Mexican tariff standoff blew over), the global economy is jittery. A recession or at least, a slowdown seems likely. And when the world economy slows down, the demand for oil slows down too. With the US pumping as much oil as it can, a return to wanton production risks oil prices crashing once again as they have done twice in the last decade. All the bluster Russia can muster fades if demand collapses – which is a zero sum game that benefits no one.

Also on the menu in Vienna is the thorny issue of Iran. Besieged by American sanctions and at odds with fellow OPEC members, Iran is crucial to any decision that will be made at the bi-annual meeting. Iranian Oil Minister Bijan Zanganeh, has stated that Iran has no intention of departing the group despite ‘being treated like an enemy (by some members)’. No names were mentioned, but the targets were evident – Iran’s bitter rival Saudi Arabia, and its sidekicks the UAE and Kuwait. Saudi King Salman bin Abulaziz has recently accused Iran of being the ‘greatest threat’ to global oil supplies after suspected Iranian-backed attacks in infrastructure in the Persian Gulf. With such tensions in the air, the Iranian issue is one that cannot be avoided in Vienna and could scupper any potential deal if politics trumps economics within the group. In the meantime, global crude prices continue to fall; OPEC and OPEC+ have to capability to change this trend, but the question is: will it happen on June 25?

Expectations at the 176th OPEC Conference

  • 25 June 2019, Vienna, Austria
  • Extension of current OPEC+ supply deal from end-June 2019 to end-December 2019
June, 12 2019