Sarawak was shocked by bad news when US energy giant, ConocoPhillips, suddenly withdrew from the Salam-Patawali deep-sea oil and gas mega project, thus jeopardizing the potential investment worth RM13.7 billion.
The project, which has been explored with Petronas since 2018, was supposed to be the backbone of oil and gas production until 2067.
However, according to industry sources, ConocoPhillips decided to withdraw due to “policy uncertainty” and the uncertain atmosphere following the power dispute between Petronas and the Sarawak state government.
This withdrawal is not only a blow to Sarawak’s efforts to establish itself as a major player in the energy sector, but also has caused concern among other foreign investors.
More surprisingly, Thai company, PTTEP, is reported to be re-evaluating the $6 billion Lang Lebah gas project, signaling that more and more investors are starting to question the risks of investing in Sarawak.
With Petros still considered to be at par with Petronas in terms of technical expertise and international network, confidence in Sarawak's ability to handle mega projects independently is increasingly being questioned.
Now, Sarawak not only needs to find a successor to continue the development of the Salam-Patawali field, but also needs to prove to the world that political conflict will not derail its economic future.
