Document background
The Production Handling Agreement is essential in the Malaysian oil and gas industry where shared infrastructure and third-party processing facilities are common. This agreement type is particularly relevant when one party needs to process their hydrocarbon production through facilities owned by another party, typically to achieve economic efficiency or address technical constraints. The document must comply with Malaysian law and PETRONAS regulations, covering detailed operational, technical, and commercial arrangements. The agreement includes specific provisions for capacity allocation, processing specifications, tariff structures, and operational procedures, while addressing HSE requirements and risk allocation. It's commonly used in mature basins where optimization of existing infrastructure is crucial, or in new developments where building separate processing facilities isn't economically viable.
