KOTA KINABALU – Sabah natural gas supplier and transporter, Sabah Energy Corporation Sdn Bhd (SEC) is expected to assume control of the state’s natural gas pipeline from Petronas beginning April 1 this year.
SEC chief executive officer, Adzmir Abdul Rahman, said the take-over will mainly be on merger and acquisitions of the pipelines which will see SEC supply around 90 million scuffs of natural gas to the domestic market.
“This (the pipelines) will be the ones that branch out of the Sabah-Sarawak Gas Pipelines.
“We will take over the branches that are in Sabah,” he told reporters when met after the signing of natural gas sales agreements between SEC and several investors at Menara Kinabalu here today.
“We want to make sure all the assets we are taking over (of the pipelines from Petronas) will assure us returns.
“Those not giving us any profits, we will do away. We are not taking over the big pipes yet.
“But this will be studied. We want to see the ones that we are taking over will give us returns,” he added.
The Sabah–Sarawak Gas Pipeline is a 500km natural gas pipeline that links Kimanis in Sabah to Bintulu in Sarawak which is part of the Petronas’s Sabah-Sarawak Integrated Oil and Gas Project.
SEC expected take over came in view of the signing of the commercial cooperation agreement between the state and Petronas on December 7, 2021 and subsequently, Putrajaya handing over control of gas regulation to the state on December 21 the following year.
The move has allowed Sabah to be more involved in its natural gas resources.
Meanwhile, SEC has signed multiple natural gas sales agreements (GSAs) and a heads of agreement (HOA) with major investors in the state.
The first GSA involves a long-term GSA between SEC and Kibing Solar New Materials Sdn Bhd for their silica processing plant and solar panel project located in Kudat.
SBH Kibing is investing RM2 billion in Sabah and potentially churn up 1,800 jobs to locals.
The second GSA is signed between SK Nexilis Malaysia Sdn Bhd, the South Korean company currently investing RM4.2 billion in Sabah its first copper foil manufacturing facility in Sabah’s Kota Kinabalu Industrial Park.
SK Nexilis is a leading manufacturer of copper foil for batteries for electric vehicles and flexible Copper Clad Laminate for the display parts industry.
SEC has also signed a Gas Sales HOA with Petronas Gas Bhd’s subsidiary, RGTLD, for the long-term supply of natural gas, in which SEC will take the role as supplier in the RM230 million plant project at the Sipitang Oil and Gas Industrial Park in the district of Sipitang.
The plant, which will be the sole energy supplier to the state's first nearshore 2.0 million tonnes per annum floating liquefied natural gas facility, is expected to complete in 2026.
On January 17, 2023, SEC concluded the Natural Gas Sales Novation Agreement with Petronas, Petronas Carigali Sdn Bhd, and existing independent power producers, with a total capacity of 880 MW.
The agreement has allowed SEC to emerge as the major natural gas supplier for the power sector.
Chief Minister Datuk Seri Hajiji Noor said SEC will now play a main role in supporting the growth of Sabah’s industries via entering into these deals.
“This augurs well for the state's economic growth in line with the GRS-led state government’s aspirations under its Sabah Maju Jaya initiatives,” he said.
Also present were state secretary Datuk Seri Safar Untong, state attorney-general Datuk Nor Asiah Mohd Yusof and SEC chairman Datuk Anwar Ayub. – The Vibes, March 6, 2023
