Project Overview

The Sepat FPSO is a new-build Floating Production, Storage and Offloading (FPSO) vessel under development as part of the Sepat Integrated Redevelopment Project in Block PM313, offshore Terengganu, Peninsular Malaysia.

OceanSTAR was awarded the full EPCIC and 15-year lease-and-operate contract on 26 February 2026. The award marks OceanSTAR's first FPSO development in Malaysia and represents the commercialisation of its OSE GH200 Generic Hull Standardised Design for a third time. The contract structure is a lease-and-operate arrangement: OceanSTAR owns and operates the FPSO for PCSB under a 15-year firm charter period.

The FPSO has a capacity to process approximately 30,000 barrels of liquid per day and will feature gas injection, gas lift, and future water injection capabilities designed to manage the field's CO2 content and maximise hydrocarbon recovery over the long term. 

Sepat FPSO Location

The Sepat FPSO is located in the South China Sea offshore Terengganu on the east coast of Peninsular Malaysia, within Block PM 313 operated by PETRONAS Carigali. It sits in shallow water of approximately 70 meters depth, about 130 kilometers east of Kuala Terengganu and around 80 kilometers from the Dulang field. 

Project Background

The Sepat fields were identified as priority targets in April 2011. PETRONAS contracted Petrofac of the UK as the RSC (Risk Service Contract) operator, and Petrofac arranged a converted FPSO, more accurately described as an MOPU and FSO (Floating Storage Unit) tandem system, to produce the field. 

Petrofac's RSC at Sepat was one of Malaysia's early experiences with the model, and the field has been produced under this Early Production System since approximately 2011.

The decision to replace the existing MOPU/FSO arrangement with a purpose-built, new-build FPSO, announced through PCSB's September 2024 pre-qualification exercise and resulting in the February 2026 EPCIC award to OceanSTAR, reflects a maturing of the Sepat field's development profile. 

The project is built on OceanSTAR's proprietary OSE GH200 'Generic Hull', a standardised FPSO hull design that received Approval in Principle (AiP) from Bureau Veritas and a Basic Design Assessment in 2024. 

The early production system was always intended as an interim measure. The integrated FPSO provides a permanent production hub capable of handling the field's full development scope. It further includes CO2 management through gas injection and the water injection provisions needed for sustained reservoir pressure and long-term recovery. The 15-year charter horizon reflects the field's production life expectations under this more comprehensive development approach.

The Sepat field's high CO2 content is a characteristic engineering challenge for Malaysian offshore fields in this geological zone. CO2 not only reduces the energy content of produced gas but also creates acidic conditions that accelerate corrosion in production equipment and pipelines. 

The FPSO's gas injection system addresses this by separating CO2 from the produced hydrocarbons and reinjecting it into the reservoir, a process that simultaneously manages the CO2 handling challenge and contributes to enhanced oil recovery by maintaining reservoir pressure. 

Sepat FPSO Current Status

As of August 2026, the Sepat FPSO is in the execution phase of the Sepat Integrated Redevelopment Project, with engineering, procurement and construction (EPC) now underway for the new FPSO unit. In May 2026, OceanSTAR Elite signed the EPC contract with China Merchants Heavy Industry (Jiangsu) to build the vessel, marking the transition from planning to full-scale construction. 

Stakeholder Details

Sepat FPSO Cost Details

The total estimated cost for the Sepat FPSO is not disclosed officially. 

Project Timeline

Design & Engineering Details

Conclusion

The Sepat FPSO project is a key redevelopment initiative by PETRONAS to revive and extend production from the mature Sepat field offshore. The unit, with a processing capacity of approximately 30,000 barrels of liquid per day, will be spread-moored at a water depth of  70 meters. Furthermore, it is equipped with gas injection, gas lift, and future water injection systems to maximize recovery and operational efficiency. 

It transitions from a legacy MOPU/FSO configuration to a modern, integrated FPSO-based production system. The project underscores PETRONAS’s commitment to sustaining domestic hydrocarbon production through targeted brownfield investments and the adoption of repeatable, cost-effective FPSO architectures. 

Upon operation, it creates a potential hub for future satellite developments in Block PM313, reinforcing the asset’s role in Malaysia’s offshore production landscape through the 2030s and beyond. 

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