An environmental impact assessment (EIA) of the Dulang Oilfield Development Project, was conducted to determine whether the project could proceed in a safe and environmentally acceptable manner. This is the first EIA for an offshore oilfield in Malaysian waters, and was conducted in anticipation of the Environmental Quality (Prescribed Activities) (Environmental Impact Assessment Order (1987)) which requires an EIA to be conducted for major oil and gas field development projects.
Asia's first off-shore well was drilled on the north-west continental shelf of Borneo in 1957 and by 1985, half the region's production was from off-shore fields. Development plans for the Dulang field anticipates initial production to commence in 1990 at a level of about 5000 barrels per day (BOPD) which would peak to 46,000 BOPD before tapering off by the year 2006/07. The project site is oil- and gas-rich. Seventeen oil and 29 gas fields have been identified and is estimated to contain 50% of Malaysia's total oil and gas reserves. Eleven oil fields have already been brought under production which now account for just over half of Malaysia's oil output. It is indeed an area of intense activity.
PETRONAS is empowered to develop Malaysia's petroleum resources under the Petroleum Development Act of 1974. In order to ensure that benefits accruing from petroleum development is not negated by poor environmental management, PETRONAS adheres to the corporate philosophy that development of petroleum resources would be compatible with the need for sound environmental management. Major development projects initiated under its banner have never failed to take proper account of potential environmental impacts.
However, in 1985 the Malaysian government enacted the Environmental Quality (Amendment) Act, which requires any person intending to conduct any proscribed activity to submit a report on the impact of that activity on the environment to the Director General of the Department of Environment for approval. At the time the Dulang Oilfield Development Project reached its engineering design phase, draft guidelines on the conduct of Environmental Impact Assessment (EIA) were already available for use by the major industries, including the petroleum industry. It was thus timely that the EIA for the Dulang field was commissioned then, and it became the first off-shore oilfield development project in Malaysia that was subjected to an EIA which closely followed the requirements of the Department of Environment, although the legal instrument to do so - viz. the Environmental Quality (Prescribed Activity) (Environmental Impact Assessment Order) - would be gazetted only at the end of 1987.
The record does show that contamination of the environment by petroleum from offshore exploration and production per se is relatively minor. Most marine and coastal pollution by petroleum in Malaysian waters originate from trans-shipment accidents. Nevertheless, the potential environmental impacts of off-shore petroleum development and production has never been assessed fully before this.