The award is expected to help bolster interest in exploration activities offshore Sabah with more block investment opportunities on offer, Malaysian national oil company (NOC) Petronas said Friday.

ConocoPhillips will operate Block SB405 with an 85% interest. Petronas Carigali, the upstream division of the NOC, will hold the remaining 15% stake. ConocoPhillips already holds interests in five production-sharing contracts (PSCs) in Malaysia; Block J, G and Kebabangan offshore Sabah, as well as SK304 and WL-00 offshore Sarawak.

The entry of the U.S. major with its proprietary seismic technology into Block SB405 is expected to enhance the hydrocarbon resource potential off the coast of Sabah, said Petronas.

“This is an area that has a proven working petroleum system with previous discoveries such as Kuda Terbang and Nymphe fields. At the same time, the new investment of ConocoPhillips in Block SB405 represents enhanced confidence of foreign investors in the upstream sector in Malaysia,” added the NOC.

“The partnership with Petronas Carigali provides that winning combination to support the potential development of the resource within the North East Sabah basin area upon successful commercialisation of the discoveries,” said Petronas.

“Under our right asset, right player strategy, we hope to unlock the full potential of the hydrocarbon resources in Malaysia towards successfully delivering clean and reliable energy to our customers in Malaysia and abroad,” added the Kuala Lumpur-based company said.

Block SB405 is located in the North East Sabah basin, off the coast of Sandakan, with an area size of 5,857 square kilometres and in water depth of up to 100 metres.