Production sharing agreements can be beneficial to governments of countries that lack the expertise and/or capital to develop their resources and wish to attract foreign companies to do so.
As a performance-based agreement, it is developed in Malaysia for the Malaysian people and private partners to both benefit from successfully and viably monetizing these marginal fields.
At the Center for Energy Sustainability and Economics' Production Optimisation Week Asia Forum in Malaysia on 27 July 2011, Finance Deputy Minister YB.
Donald Lim Siang Chai expounded that the trail-blazing RSC calls for optimal delivery of production targets and allows for knowledge transfer from joint ventures between foreign and local players in the development of Malaysia's 106 marginal fields, which cumulatively contain 580 million barrels of oil equivalent (BOE) in today's high-demand, low-resource energy market.
This emphasis on optimising production capacities in marginal fields can be extended to contracts governing the recovery of main oilfields in an industry of rapidly depleting resources.