Anglo-Dutch major Shell has signed a heads of agreement with state-run Petronas for two 30-year production sharing contracts for enhanced oil recovery projects, offshore Malaysia.

The firms will extend the life and increase the recovery factor of the Baram Delta and North Sabah fields.

Petronas and Shell aim to improve the recovery efficiency of the oilfields by an additional 90-100 barrels of oil per day and extend the field life to beyond 2040.

The agreement provides Shell with an opportunity to work with Petronas to build local knowledge and capabilities in enhanced oil recovery, says Shell CEO Peter Voser.