Southeast Asia Oil And Gas Upstream Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Southeast Asia Oil And Gas Upstream Market Trends and Insights

Surging Regional Gas Demand for Power & Industry

Natural gas consumption across the power and industrial sectors is forecast to reach 210 billion m³ by 2030, a 45% increase over current levels. Indonesia’s PLN plans 20.9 GW of new gas-fired capacity, and Malaysia’s market reforms treat gas as the preferred balancing fuel for solar and wind integration. Petrochemical expansions in Thailand and Singapore will lift feedstock needs, ensuring multi-decade demand visibility. This structural call on gas underpins aggressive upstream sanctioning of high-CO₂ reservoirs that embed carbon-capture modules. Consequently, operators secure long-term sales contracts before first gas, de-risking multibillion-dollar investments and supporting the Southeast Asia oil and gas upstream market.

Deep-Water Gas Discoveries & Planned FIDs

Indonesia’s Geng North (2.5 TCF) and Malaysia’s Kasawari (3.3 TCF) rank among the world’s most consequential deep-water finds, located in waters exceeding 1,500 m depth. BP’s USD 7 billion Tangguh Ubadari sanction and Vietnam’s Block B commitment illustrate investor confidence in subsea production, floating LNG, and CCS integration. Deep-water hubs shift the supply map away from maturing shelf assets and set local engineering benchmarks for high-pressure, high-CO₂ developments. As national grids shift toward gas, these discoveries encourage fresh frontier exploration, reinforcing the outlook for growth in the Southeast Asia oil and gas upstream market.

Enhanced Fiscal Terms & New PSC Licensing Rounds

Indonesia now lets operators choose between cost-recovery and gross-split PSCs, trimming state take by 5-8 percentage points on marginal fields.^{[1]Indonesian Ministry of Energy and Mineral Resources, “PSC Fiscal Reform,” esdm.go.id} Malaysia offers Small Field Allowance and Late-Life Asset schemes that extend plateau production. The Philippines’ 2024 bid round cut typical approval cycles to 12 months, improving investment certainty. Competitive fiscal liberalization among governments is driving a regional bidding race that channels capital toward both brown- and greenfield opportunities. The resulting deal flow sustains drilling commitments and bolsters the Southeast Asia oil and gas upstream market.

Mid-Size Asset Divestments by IOCs Opening Opportunities for NOCs

Global majors are pruning mature Southeast Asian holdings to fund low-carbon portfolios, selling mid-size assets to regional NOCs and independents. TotalEnergies’ purchase of SapuraOMV stakes in Malaysia and Chevron’s exit from a Singapore refinery typify the trend. Buyers inherit cash-flowing fields, plus upside in redevelopment, to enhance project economics, enabling NOCs such as PETRONAS and PTTEP to expand their operations and conduct infill drilling. Fiscal sweeteners further improve project economics, allowing NOCs such as PETRONAS and PTTEP to deepen domestic and cross-border exposure. Ownership churn keeps rigs working and preserves workforce skills, reinforcing market continuity.

Rapid Decline of Mature Shallow-Water Oil Fields

Shelf assets installed in the 1980s and 1990s now face annual decline rates of 8-12% as reservoir pressure falls and facilities surpass their design life. Indonesia alone operates more than 630 offshore platforms, many of which are over 40 years old.^{[2]PETRONAS, “Asset Retirement Obligations Overview,” petronas.com} Replacement projects often fail to clear capital hurdles, prompting operators to abandon them prematurely. Such accelerated shut-ins weigh on near-term liquids output and cap upside to the Southeast Asia oil and gas upstream market.

Global Rig/Sub-Sea Equipment Tightness Stretching Project Schedules

Jack-up utilization in the Asia Pacific reached 97% in 2025, and deep-water drillships are approaching full booking.^{[3]Offshore Magazine, “Asia-Pacific Rig Market Tightens,” offshoremag.com} Malaysia requires 118 additional offshore support vessels annually through 2027, yet a fifth of the current fleet is laid up or non-compliant. Scarcity inflates day rates by double-digit percentages, lengthens project timelines by up to 12 months, and raises break-even prices. Developers must sequence projects carefully to avoid cost overruns, which can temper the growth of the Southeast Asia oil and gas upstream market.

Segment Analysis

By Location of Deployment: Deep-Water Expansion Bolsters Offshore Dominance

Offshore activities generated two-thirds of 2024 revenue, and the segment is forecast to compound at a 6.2% CAGR through 2030 as operators sanction ultra-deep gas hubs. The Southeast Asia oil and gas upstream market size for offshore reached USD 18.0 billion in 2025, reflecting momentum from Indonesia’s Geng North and Malaysia’s Kasawari FPSO installations. Floating production systems, subsea compression, and CCS modules are now integral, enabling the commercialization of previously stranded high-CO₂ accumulations.

Onshore spending holds a smaller share, but investments in predictive maintenance and reservoir modeling lift recovery from legacy Sumatra and Thai onshore blocks. AI-enabled optimization reduced downtime 15-20% on Shell’s Malaysian assets^{[4]Shell, “Digitalization of Malaysian Platforms,” shell.com}, helping offset natural declines. As the deep-water drive continues, rig and vessel bottlenecks will dictate project sequencing and preserve the premium enjoyed by offshore contractors within the Southeast Asia oil and gas upstream market.

Note: Segment shares of all individual segments available upon report purchase

By Resource Type: Gas Ascendancy Accelerates Energy Transition

Natural gas logged the fastest 8.5% CAGR and is expected to surpass half of incremental hydrocarbon volumes by 2030. Utility decarbonization mandates and petrochemical expansions lift baseload demand, while LNG import dependence prompts governments to monetize domestic gas. The natural-gas component of the Southeast Asia oil and gas upstream market is expected to increase from USD 11.2 billion in 2025 to USD 17.0 billion by 2030.

Crude oil remains important, holding a 54.9% share in 2024, but incremental growth centers on gas-rich reservoirs with CCS readiness. PETRONAS’s Kasawari Phase 1 integrates 3.3 million tonnes per year of carbon-capture capacity, turning sour gas into a bankable project. Strong regional gas prices and policy support sustain the investment thesis, even as liquids output gently declines.

By Well Type: Unconventional Methods Revitalize Mature Basins

Conventional drilling still accounts for 84.7% of the revenue, yet unconventional wells are projected to grow at a 7.7% CAGR through 2030, as horizontal drilling, multistage stimulation, and digital twins unlock previously inaccessible resources. AI-driven workflows reduced non-productive time 15-20% across pilot wells, improving capital efficiency for marginal prospects.

The Southeast Asia oil and gas upstream market share for unconventional operations remains modest today; however, aggressive pilot programs in Indonesia’s Sumatra and Malaysia’s Peninsular fields indicate a rising adoption. Cost curves decline as learning effects accumulate, allowing operators to profitably redevelop brownfields without requiring large-scale surface upgrades.

Note: Segment shares of all individual segments available upon report purchase

By Service: Decommissioning Surges Amid Infrastructure Maturity

Development and production services accounted for 69.1% of revenue in 2024, reflecting ongoing brown- and greenfield work. However, decommissioning is forecasted at an 8.1% CAGR, as 200 fields and 1,500 platforms near the end of their operational life. This niche could touch USD 5.0 billion within the Southeast Asia oil and gas upstream market by 2030. PETRONAS has earmarked USD 2 billion over ten years for retirements across 300 platforms, 40% of which have exceeded their 30-year design life.

Engineering houses are pivoting toward well-plugging, jacket removal, and reefing solutions, supplementing revenue lost to IOCs’ divestments. Exploration services retain a steady but smaller slice as licensing reforms keep frontier acreage on the radar, particularly in Brunei deep-water blocks and Myanmar once political stability returns.

Geography Analysis

Indonesia accounted for 35.6% of 2024 revenue, as dual PSC options reduced the government's share and unlocked FIDs, such as BP's USD 7 billion Tangguh Ubadari project. The nation's 630-plus platforms provide a steady pipeline for workover and decommissioning contracts, while new deep-water gas hubs extend the production outlook beyond 2035. Fiscal agility and improved permitting enable Indonesia to maintain its leadership in the Southeast Asian oil and gas upstream market.

The Philippines is the fastest-growing jurisdiction with a 6.3% CAGR through 2030. Malampaya Phase 4's success, coupled with eight new Predetermined Areas offered in 2024, reduced the average licensing cycle to 12 months. Political stability and straightforward gross-split terms attract new capital for both shallow-water gas and frontier Palawan prospects, enabling Manila to displace imported LNG volumes.

Malaysia stays pivotal through PETRONAS's integrated role and tailored fiscal packages for deep-water, small fields, and high-pressure reservoirs. The country's specialized PSCs protect break-even below USD 50/bbl, encouraging infill drilling at late-life assets even as decommissioning ramps up. Thailand and Vietnam generate steady cash flow but face risks of delays from environmental reviews and South China Sea territorial disputes. Singapore acts as a logistics and financial hub, wMyanmar'smar’s resource potential remains contingent on political normalization.

Note: Segment shares of all individual segments available upon report purchase