NewCo plans to invest more than $15 billion over next five years
Italian energy giant Eni and Malaysian national energy behemoth Petronas on Monday signed a binding agreement to establish a 50:50 joint venture to manage certain key high-impact upstream assets in Indonesia and Malaysia.
The new entity NewCo will manage 14 assets in Indonesia and five in Malaysia. Future plans for the joint venture also include the development of at least eight new projects and the drilling of 15 exploration wells, with the aim of exploiting approximately 3 billion barrels of oil equivalent of discovered reserves and unlocking an estimated 10 billion boe of unrisked exploration potential.
NewCo will operate as a financially self-sufficient entity, expected to be established by 2026, which plans to invest more than $15 billion over the next five years.
“By leveraging existing production assets and developing material initiatives in both the Kutei basin and in Malaysia, we expect to deliver over 500,000 barrels of oil equivalent per day in the mid-term,” commented Eni chief executive Claudio Descalzi.
Upstream earlier reported that initial production from the proposed joint venture is expected to come from Eni’s under-development Kutei North Hub project offshore Indonesia.
“This historic partnership between Petronas and Eni is envisaged to set a new benchmark for more efficient, cost-effective and responsible upstream development,” said Petronas chief executive Tengku Muhammad Taufik.
“Adopting this innovative and proven business model reinforces Petronas’ firm commitment to support national and regional energy aspirations, as it paves the way for us to deliver greater and more sustainable value to our customers, host nations, the greater upstream sector, as well as our stakeholders.”
The joint venture supports both companies’ broader gas aspirations and complements Petronas’ other established businesses in Indonesia outside of the joint venture scope, enabling new opportunities for growth and innovation in the sector, added the Malaysian company.
The co-venturers noted that NewCo would focus on gas projects — both new and existing — including the Kutei basin, an area considered relatively low-risk and high-potential thanks to existing production, transport and liquefaction infrastructure and a mature geological understanding of the subsurface.
Recent milestones include the Geng North discovery and the approval of the Geng North–Gehem integrated development (Northern Hub), both in the Kutei basin.
The assets included in the transaction will retain their current operating set-up, with a strong focus on health, safety and environment, and on time-to-market.
Eni noted the creation of a NewCo with Petronas brings to life a new energy player with a key role in Asia Pacific, particularly in the burgeoning liquefied natural gas market.
Subject to the necessary regulatory approvals in Malaysia, Indonesia and other relevant jurisdictions, as well as partners’ consent requirements and/or pre-emption rights, the new joint venture company is expected to be established in 2026.
The agreement signed on 3 November formalised a process that commenced with a memorandum of understanding in February and the framework agreement that was signed in June during Energy Asia 2025 in Kuala Lumpur.
The NewCo applies the principles of Eni’s satellite model, establishing dedicated, financially self-sufficient entities designed to accelerate industrial growth and value creation — which the company already implemented in previous transactions with Vaar Energi in Norway, Azule Energy in Angola and Ithaca Energy in the UK.
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