Brunei's Energy Sector Poised For Growth

Rachel Thien

BANDAR SERI BEGAWAN

Sunday, December 21, 2014

Brunei’s energy sector continues to develop at a steady pace as it seeks to build a sustainable future and meet the Vision 2035 targets set by the government.

As Brunei’s main source of revenue, the oil and gas sector must boost production to meet the target of 650,000 barrels of oil equivalent per day by 2035.

Over the last three years, the Energy Department at the Prime Minister’s Office has been stepping up efforts to increase local employment in the sector. At least one nationwide energy sector job fair has been held annually since 2012. This year, the department set a target of recruiting 3,000 locals, which was surpassed.

In March, His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah, the Sultan and Yang Di-Pertuan of Brunei Darussalam officiated at the launching of Energy Week 2014.

At the event, His Majesty launched two important documents for the industry: the Energy White Paper and The Brunei Darussalam Oil and Gas Book.

The Energy White Paper was designed to support Brunei’s Vision 2035, promoting career, employment and business opportunities in the energy sector.

It also sets targets that the oil and gas industry must meet by 2035, including hiring more Bruneians.

Below is a roundup of events and initiatives undertaken by the department for the year 2014.

Energy Week 2014

Energy Week kicked off on March 24 and was officially launched by His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah, the Sultan and Yang Di-Pertuan of Brunei Darussalam.

One of the highlights of the event was His Majesty’s launching of Brunei’s first Energy White Paper.

According to Minister of Energy at the Prime Minister’s Office Yang Berhormat Pehin Datu Singamanteri Colonel (Rtd) Dato Seri Setia (Dr) Hj Mohammad Yasmin Hj Umar, the White Paper is a blueprint that outlines the current state of the Sultanate’s oil and gas industry and its future development.

There are three strategic goals and 10 key performance indicators (KPI) for Brunei Darussalam’s energy sector.

Under the White Paper, the Energy Department will also be introducing a government and industry task force to ensure transport fuel supplies are not interrupted.

Four priority initiatives were identified to secure uninterrupted supplies of fuel.

Meanwhile, Brunei needs to attract $70 billion to $80 billion in cumulative investments from 2011 to 2035 to achieve its Gross Domestic Product (GDP) target.

The government will evaluate four main ideas based on successful best practices in investment attraction.

This was outlined as one of the key performance indicators in the Energy White Paper’s third strategic goal, which aims to boost local content.

YB Pehin Dato Hj Mohd Yasmin said the government will review the Energy White Paper possibly every two to three years to ensure that it is always up to date with national and global perspectives.

Energy White Paper

Currently, Brunei produces 372,000 barrels of oil equivalent per day (BOEPD) of oil and gas.

The Energy Department in the Prime Minister's Office (EDPMO) is targeting a 62 per cent increase in production by 2035 by maximising oil and gas field output to 650,000 BOEPD.

In downstream ventures such as chemical and petrochemical plants, the EDPMO plans to increase economic output from $300 million in 2012 to $5 billion by 2035.

The EDPMO is aiming to reduce energy intensity by 45 per cent by 2035, in line with Brunei’s commitment to APEC.

With regards to renewable energy, the EDPMO wants to increase solar energy production from 1,700 MWh to 954,000 MWh by 2035. The aim is to increase the share of renewable energy to 2.7 per cent in the total power generation mix.

The EDPMO wants to maximise local industry contribution to the sector from 15 per cent to 80 per cent by 2035. The number of local employees in the energy industry is also expected to grow from 24,000 in 2013 to 40,000 in 2035.

Additionally, the government is targeting at least 30 local companies to go international by 2035.

Companies that generate more than 40 per cent of their sales from overseas markets will be deemed to have “ventured overseas”.

Energy Efficiency and Conservation (EEC) efforts

Energy efficiency and conservation and creating jobs were the main focus of Energy Week this year.

This emphasis on creating jobs was part of the local development initiative.

Energy clubs at schools were invited to participate in Energy Week to showcase their projects to create awareness and understanding on using energy wisely.

Energy Industry and Competency Framework (EICF)

The EICF is a collaboration between EDPMO, the Ministry of Education and the oil and gas industry with the aim of increasing job readiness and competencies among Bruneians in the energy industry - in line with one of the aspirations of Vision 2035 - to produce a well-educated and highly skilled workforce.

The minister said the Mechanic Training Centre provides potential recruits with the required skills that are accredited internationally.

“This means that this is not only for Brunei. Once you get these sets of skills, you can go and work abroad as well. Some of these skills are very much in demand, even in this region,” he said.

YB Pehin Dato Hj Mohd Yasmin noted that there are currently 22 technical skills, and from time to time, they will be reviewing the framework and the numbers will increase.

Brunei Maritime Academy (BMA)

Earlier this year, the Brunei Maritime Academy was launched with 325 locals who applied.

Seven strategic goals on the progression of the BMA, including adequate wages and job security, were outlined by the energy minister.

“Employees (graduates of the BMA) will be given suitable wages. On average, the starting salary for offshore staff is at least $1,000 (per month), and this does not include benefits such as offshore allowance and overtime,” he said.

He added that job security will also be provided by revising contracts to include a roll-over clause for new contractors to take over local employees from previous contractors of Brunei Shell Petroleum in the maritime sector.

The strategic goals also included ensuring that training courses and content for the BMA are industry-ready.

The EDPMO will prepare reasonable and considerate terms and conditions for employees such as 10-day mandatory leave for each month spent onboard the vessels.

Health, Safety and Environment (HSE)

The Energy Department has made it clear that all operators and companies in the industry need to comply with HSE in all stages of their operations.

The legal and best practices of HSE must be observed at all times, said the minister.

“There will not be any compromise on this,” he said, as the government places great importance on these three areas within the oil and gas industry.

He also advised industry players to adhere to and respect rules and regulations as well as directives, particularly those relating to HSE.

Anyone can file a report to the Energy Department if the management or a company is found to be in violation of HSE requirements.

Control of Major Accident Hazards Regulations

Last June, the minister said Brunei’s oil and gas industry will have higher safety standards with the establishment of Control of Major Accident Hazards Regulations.

YB Pehin Dato Hj Mohd Yasmin said this undertaking is unprecedented and has never been carried out before in Asia.

“Brunei will definitely be put on the map with regards to safety standards, and this will make Brunei the centre of excellence for health and safety. That is the vision,” he said.

The new system makes it mandatory for oil and gas industry players to get certified in health and safety.

The minister said all companies in Brunei’s oil and gas industry will have to observe safety norms.

Courtesy of The Brunei Times