* Market value estimated at $4 bln-$5 bln - sources
* Sources say assets attract interest from PTTEP and OMV
* Hess, Petronas are equal partners in the projects
* Hess has not decided if it would sell assets -sources
* Malaysia assets "important part" of portfolio - Hess
By Anshuman Daga
SINGAPORE, Aug 20 (Reuters) - The Southeast Asian offshorenatural gas assets of U.S. oil and gas producer Hess Corp, estimated to be worth as much as $5 billion, haveattracted takeover interest from firms including Thailand'sPTTEP PCL and Austrian energy group OMV AG,people familiar with the matter said.
Hess, which has a collection of gas fields in North MalayBasin in offshore Malaysia and in the Malaysia-Thailand JointDevelopment Area (JDA) with 50 percent equal partner Petronas,has not yet decided whether to sell the assets, according tofinancial and industry sources.
Their estimated market value would be about $4 billion to $5billion, the sources said. They declined to be identifiedbecause the takeover interest had not previously been madepublic.
The interest in Hess' assets, among the few long-term andsizeable projects in the region, comes as cashed-up firms suchas PTTEP are buying overseas assets, while the likes of OMV andKuwait Foreign Petroleum Exploration Company have been scouringfor acquisitions in Asia..
Hess, which hasn't reported a profit since 2014, has beenunder pressure from investors to make money. It posted asmaller-than-expected loss in April-June, but many of its peershave turned profitable after the oil price crash two years ago,fuelling questions as to why Hess has not followedsuit.
The firm is developing large offshore oil projects in SouthAmerica and U.S. shale oil. In 2014, it sold its Thai assets toPTTEP for $1 billion and also sold its Indonesian assets.
"We don't comment on rumours but we continue to believe thatour Malaysia assets are an important part of our portfolio andour value creation strategy," Hess spokeswoman Lorrie Heckersaid in a statement.
"JDA and North Malay Basin are significant long-term,low-cost cash generators, producing stable production and freecash flows, which provide funding for our compelling, long-termopportunities in Guyana and the Bakken (in the United States)."
'TEAMS WORKING ON THIS'
"A number of parties have looked (at the Hess assets) andhave teams working on this," said one financial source."Increasing numbers of companies believe a sale is probable,"said the person, adding that Hess' project would also appeal toprivate-equity backed players and mid-sized energy firms.
He said PTTEP was working with a financial advisor for itsinterest in the assets.
Another source said some parties had done preliminary workon the assets and were waiting to see if Hess would start a saleprocess.
OMV and Kuwait Foreign Petroleum Exploration Companydeclined to comment.
This month, OMV won regulatory approval to buy Royal DutchShell's upstream assets in New Zealand for $578million. OMV said in March that the acquisition was a key stepto develop Australasia into a core region in line with its newstrategy.
Petronas declined comment while PTTEP said it was focused onexpanding in Southeast Asia.
"PTTEP is interested in M&A deals with particular focus onassets located in PTTEP's region of experience such as SouthEast Asia, which is PTTEP's areas of expertise and the operatingrisk is moderately low," the Thai company told Reuters,declining to comment specifically on Hess assets.
IMPROVING INDUSTRY OUTLOOK
The industry's prospects have brightened as oil andnatural gas <LNG-AS> prices have more than doubled since early2016, with demand for oil in Asia - the world's biggest consumer- also growing strongly even as production is falling fasterthan anywhere else.
Hess' nine gas fields in the North Malay Basin have anestimated gross recoverable resource of more than 1.5 trillioncubic feet of natural gas and over 20 million barrels ofcondensate. Production started in July 2017.
The company has a 50 percent working interest in theSoutheast Asian blocks with Petronas Carigali, a fully-ownedsubsidiary of Petronas.
Hess signed a production-sharing contract with Petronas in2012 and has a contract with the oil major till 2029.
"Hess is pursuing divestments globally, high grading itsportfolio centred around its Guyana and U.S. Bakken (shale)interests," said Saul Kavonic, director of Asia/Pacific marketsand head of energy research in Australia at Credit Suisse.
(Reporting by Anshuman Daga; Additional reporting by HenningGloystein in SINGAPORE, Ernest Scheyder in HOUSTON, ChayutSetboonsarng in BANGKOK, A. Ananthalakshmi in KUALA LUMPUR,Kirsti Knolle in VIENNA and Hadeel Al Sayegh in DUBAI; Editingby Kenneth Maxwell)
