SABAH OIL AND GAS

TERMINAL PROJECT: A
CASE STUDY
Name
Luqman bin Osman

Matric Number
MK1622030T

Course
Master of Oil and Gas Engineering

Subject
KOGE 11203 Project Management and Economics in Oil and Gas

Lecturer
En. Zakaria Aris
INTRODUCTION

Sabah Oil and Gas Terminal (SOGT) located in Kimanis, Sabah is part of the Sabah-Sarawak
Integrated Oil and Gas Project undertaken by Petronas Carigali in the state of Sabah, in east
Malaysia. The terminal processes oil and gas produced from the region’s offshore fields. The
integrated project involved construction of an upstream infrastructure to tap offshore oil and
gas reserves in the Sabah region and process the produced resources. It included offshore
field development, construction of the SOGT and a 512km onshore pipeline called the Sabah-
Sarawak Gas Pipeline. The new terminal is needed because crude oil terminal Labuan and
natural gas terminal KG Gayang do not have sufficient capacity to handle oil and gas
production from new fields. The Sabah terminal became operational in December 2013. It is
designed to handle 300,000 barrels of oil a day and 1.25 billion cubic feet (bcf) of gas a day.
Sabah’s capacity is equivalent to about 40% of Malaysia’s crude oil production. The SOGT
serves the offshore fields developed as part of the Sabah-Sarawak Integrated Oil and Gas
Project. The fields include Gumusut / Kakap, Kinabalu Deep and East, Kebabangan and
Malikai.

A CASE STUDY : TEAM OVERCOMES CHALLENGES TO COMPLETE WORLD’S

LARGEST SABAH OIL AND GAS TERMINAL ON TIME AND UNDER BUDGET. HOW
DOES SOGT PROJECT TEAM OVERCOME THESE CHALLENGES TO ENABLE THEM TO
START CONSTRUCTION EARLY?

A) Early Planning

An experienced project manager and its assistant (project control engineer) can overcome
this by early planning of the project. The planning usually involve

- Development of project charter

- Develop preliminary project scope statement
- Develop project management plan
- Direct and manage project execution
- Develop Monitoring and control of project work procedure
- Integrated change control management

1|Page
B) Resource Selection

Proper selection of resource must be made. This can be done by searching high quality
material with cheap prices. A lot of research has been done to make a material cheaper but
with the same quality as the expensive one in order to cope with the current oil and gas
downturn. The contractor also could hire a multiskill personnel that can do various job.

C) Breaking the local regulation constraint

NAIM as the local partner of the project should play its role by identifying the local law and
legislation associated to the project as early as possible. This is important because SAMSUNG
engineering is a foreign company. If let say there is an internal conflict between Samsung and
NAIM, SAMSUNG should hire its own legal advisor. Identify the legal associated with the
project, develop the legal register and then comply whatever that SAMSUNG can.

D) Management of Stakeholder

Improper management of the stakeholder could lead in delay of progress and prevent early
start of the project. This should be emphasized by the PMT during the early planning phase
or FEED. Fail to develop stakeholder management plan can jeopardized the project.

CONCLUSION

There are many ways to overcome project challenge. This can be done in a lot of ways. The
efforts must be sustained to achieve the intended end results in the long run. Communication
must be made effectively and efficiently. This is a vital function that is even more crucial in
the oil and gas business because of the multitude of stakeholders.

2|Page
REFERENCE

Kerzner, H. (2015). Project Management 2.0 : Leveraging tools, Distributed

Collaboration and Metrics for Project Success. Wiley.

Kerzner, H. (2013). Project Management Case Studies.

Kerzner, H. (2014). Project Management Best Practices (3rd ed.). Wiley.

Kerzner, H. (2009). Project management: a systems approach to planning,

scheduling, and controlling. New York.
https://doi.org/10.1016/j.drudis.2010.11.015

El-Reedy, M. A. (2016). Project management in the oil and gas industry.

3|Page