On 4th January 2022, the Sabah state government, Malaysia, and Petroliam Nasional Bhd (Petronas) launched the Sabah gas master plan that would guide the development of natural gas in the state. This plan results from a collaborative study between the state government and Petronas to sustainably pursue the full potential of the domestic natural gas industry.
The Sabah gas master plan highlights three different investment opportunities for Sabah's natural gas resources. The first is the construction of an LNG (liquified natural gas) plant that has the capacity of two million tonnes per annum at the Sipitang Oil and Gas Industrial Park. This would enable Sabah to expand its LNG distribution across the state virtual pipeline system allowing more industries and commercial businesses to access and use natural gas as a clean energy source.
The second opportunity is for the state government to take up a more prominent role in gas marketing and distribution across the state, with 120 million standard cubic feet per day (MMscfd) volume of gas to be made available for the development of key industries in the state. The natural gas would be supplied from Sabah gas Terminal in Tuaran and Sabah Oil and Gas Terminal in Kimanis.
To make progress towards this intent, a Heads of Agreement (HOA) between Sabah Energy Corp Sdn Bhd and Petronas to supply 70 MMscfd of natural gas was signed. The launch also witnessed the document exchange of a previously signed HOA for 50 MMscfd of natural gas for the utilization in Sabah.
The Sabah gas master plan's third opportunity highlights a suite of petrochemical derivative options for Sabah to attract investors based on the market's needs and the future outlook, leveraging locally available stock.
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