Cendramas Production Sharing Contract
- INTRODUCTION
Further to the announcement on 11 February 2026 on the receipt of the Letter of Award from Petroliam Nasional Berhad (PETRONAS) (“PETRONAS”) with respect to the Cendramas Production Sharing Contract (“Cendramas PSC”), Dialog Group Berhad (“DIALOG”) is pleased to announce the finalisation and execution of the Cendramas PSC between Dialog Resources Sdn. Bhd. (“DRSB”), a wholly owned subsidiary of DIALOG, PETRONAS and the other Cendramas PSC partners namely Medco Asia Pacific Limited (“Medco”) and EnQuest Petroleum Production Malaysia Limited (“EnQuest”).
The participating interests of the Cendramas PSC are DRSB and EnQuest, respectively, as 25% non-operating partners while Medco is the operator with 50% stake.
The Cendramas PSC comes with several minimum work commitments including appraisal and infill wells drilling, development of discovered resources and asset life extension work.
Located off the coast of Peninsular Malaysia, Cendramas PSC gives the partners the ability to extend the life of the field beyond the current production sharing contract period and unlock further hydrocarbon potential. The Cendramas PSC becomes effective on 23 September 2026 for a period of 20 years.
Rationale and Prospects
DIALOG’s participation as a partner in the Cendramas PSC, a producing asset, is an extension of DIALOG’s upstream business to further deepen integration and expansion across the upstream, midstream, and downstream businesses of the energy sector.
The participation also complements existing investments and operatorship in the upstream business where DIALOG will remain focused and steadfast in the pursuit of diversification across the energy sector to strategically position the Group to participate and benefit from different economic and oil price cycles, which is in line with the Group’s strategy of generating long term recurring income.
- DETAILS OF THE CENDRAMAS PSC
2.1 The scope of work in accordance with the Cendramas PSC and the Joint Operating Agreement is to manage current and future operations while actively developing additional oil resources in a cost-effective manner.
Details of which have been set out in the section above.
2.2 THE CENDRAMAS PSC PERIOD
The Cendramas PSC becomes effective on 23 September 2026 for a period of 20 years.
- FINANCIAL EFFECTS
The Cendramas PSC is not expected to have any effects on the share capital and substantial shareholders’ shareholding of DIALOG and is not expected to have any material effects on the earnings, net assets and gearing of DIALOG for the current financial year ending 30 June 2026. However, it is expected to contribute positively to the future earnings of DIALOG group.
- RISKS
Risk factors affecting the Cendramas PSC include but are not limited to potential reservoir risks due to complex subsurface geology and execution risks, such as availability of skilled manpower, technical expertise and materials, changes in prices of materials, and changes in geo-political, economic, financial market and regulatory conditions. The Cendramas PSC partners collectively have proven track records for their capabilities in near field appraisal, development and operation of production sharing contracts, and the provision of specialist technical services. Nevertheless, DIALOG will undertake all the necessary efforts to mitigate the various risk factors identified.
- APPROVALS REQUIRED
The Cendramas PSC does not require approval from any relevant authorities and shareholders of DIALOG.
- INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED WITH THEM
None of the directors of DIALOG, major shareholders of DIALOG and/or persons connected with them have any interest, whether direct or indirect, in the Cendramas PSC.
