Methanol project catalyst to turn Bintulu into petrochem hub – CM

BINTULU: Sarawak Petchem Sdn Bhd’s methanol plant project in Tanjung Kidurong, once fully operational, will be a catalyst to further transform Bintulu from a world-renowned liquefied natural gas producer currently, into a petrochemical hub with future downstream valueadded integrated petrochemical complex.

Chief Minister Datuk Patinggi Abang Johari Tun Openg in stating this said the development of the petrochemical industry would be a major economic engine of growth for Sarawak in the next five to 10 years.

“This will add multiple values to our natural resources which will benefit the state economically, derived through its value chains,” he said during the ground-breaking ceremony for the proposed Sarawak Methanol Project here, yesterday.

According to the chief minister, the methanol and derivative project is one of the two initiatives of the Sarawak government to embark on more downstream value-adding petrochemical industries as one of the key drivers for the growth of the state’s manufacturing sector.

The other planned project, he said, is an ammonia and derivative plant.

“Established in June 2017, Sarawak Petchem will be the first Sarawak state-owned company that produces methanol, with an annual capacity of 1.7 million metric tonnes per annum.

“The decision for the establishment of Sarawak Petchem is timely due to abundance of natural gas as feedstock for the development of a mega methanol plant.

“The plant is expected to come on stream in 2023 and will receive 160 million standard cubic feet per day of natural gas feedstock from Petronas,” he said.

This project, added Abang Johari, marks another significant milestone not only in quest to industrialise the state, but more importantly the realisation of the state’s own vehicle to venture into the oil and gas industry, particularly in the downstream petrochemical sector.

At the same time, he said the project will generate job opportunities both during the construction of the mega project, which is anticipated to have a total workforce that could reach 4,000 workers and about 300 staff during the operation of the plant, as well as the spin-off from the plant’s operation for other opportunities including its services and maintenance.

Abang Johari said with its stateof-the-art technology, the plant will require competent personnel – engineers, technicians, operators and specialists – to operate it, thus providing employment opportunities for potential job seekers.

“Now it is the policy of the state government that (from) any new finding of gas resources in Sarawak, 40 to 50 per cent must be retained as feedstock for industries in the state,” he said.

In order to further expand the state’s economy, he said there is a need to increase value-addition activities in all sectors of the economy.

“This will be done through industrialisation by shifting to higher value-added activities, undertaking productivity-driven growth initiative and application of advanced technology.”

He stressed that downstream development is of one of the key economic sectors of the state’s economy, with oil and gas identified as one of the 10 priority industries in Sarawak Corridor of Renewable Energy (SCORE).

“Sarawak is reported to hold the largest share of the remaining Malaysian gas reserve at 54 per cent and one-third of the country’s remaining oil reserve at 29 per cent,” he said.

Abang Johari also said the Sarawak government is not contented with the existing development of the oil and gas industry in the state, as the state’s oil and gas products are still commodity base meant for exports.

“For example, the production of liquefied natural gas, ammonia and urea utilises natural gas as the feedstock for the industry. The irony is that the valueadded activities are done abroad utilising our natural gas as raw materials in their petro-chemical industries,” he added.