MoU on natural gas supply increase
Sarawak Gas Roadmap projects boosted by Petronas, Petros MoU on staggered increase of natural gas supply
Within this agreement, we have defined an operational Consultative Framework by which Petros, key State Agencies and Petronas meet to implement the CSA’s intent.
— Datuk Patinggi Tan Sri Abang Johari Tun Openg, Chief Minister
KUCHING: Petroliam Nasional Berhad (Petronas) and Petroleum Sarawak Berhad (Petros) yesterday signed a Memorandum of Understanding (MoU) on a staggered increase of natural gas supply to Sarawak for the implementation of projects under the Sarawak Gas Roadmap (SGR).
Officiating at the event, Chief Minister Datuk Patinggi Tan Sri Abang Johari Tun Openg said the supply of domestic natural gas for identified projects under the SGR will be increased from the current 450 mmscf (million standard cubic feet) per day to 1,200 mmscf per day by 2030.
“This is a step change achievement – a supply increase of over 250 per cent. Thank you Petronas,” he said.
Abang Johari said the 10year SGR is designed to realise the full potential of the state’s abundant gas resources aimed at achieving Sarawak’s Vision 2030 of becoming a high-income advanced state, by contributing towards 10 per cent growth in gross domestic product (GDP) and creating thousands of “high income” job opportunities.
“The SGR envisages implementation of broad economic activities in the period to 2030 from the development of additional power generation, petrochemical industries to reshaping the landscape of downstream businesses within Sarawak, centered upon four strategic demand hubs spanning the state,” he said.
He also said an enabler for this Vision 2030 is to drive a stepchange progress in domestic gas utilisation.
He pointed out that gas offers game-changing socioeconomic opportunities in downstream sectors, such as power generation, petrochemicals, and other industries, while limiting carbon emissions.
“Well recognised as a ‘transition fuel’ in the global decarbonisation journey, this crown jewel of Sarawak’s resources has a key role to play in meeting power demand growth and diversifying the power generation mix,” he said.
According to Abang Johari, the state government and Petronas entered into a Commercial Settlement Agreement (CSA) on Dec 7 last year, which sets out the principles for Greater Sarawak Participation, enabling greater revenue share and affording opportunities to derive equitable economic benefits from the state’s oil and gas.
“Within this agreement, we have defined an operational Consultative Framework by which Petros, key State Agencies and Petronas meet to implement the CSA’s intent. Among other equitable arrangements, the CSA envisages the formation and implementation of a comprehensive Gas Masterplan for the State of Sarawak,” he added.
Petronas chairman Tan Sri Datuk Seri Mohd Bakke Salleh said the staggered increase envisaged under the MoU would support Sarawak’s aspirations to attract investments from new, higher value-adding industries into the state.
“(This) would also provide the necessary impetus for further upstream exploration that would strengthen the state’s hydrocarbon resource base,” he said.
Petronas currently has existing agreements to supply natural gas to the power and non-power sectors in Sarawak and is actively encouraging sustained upstream investments in exploring more gas resources and further developing discovered gas resources, particularly in Sarawak.
Signing the MoU on behalf of Petronas was executive vice president and chief executive officer (Upstream) Adif Zulkifli while Petros was represented by its group chief executive officer Datuk Sauu Kakok.
It was also witnessed by Petronas senior vice president of Malaysia Petroleum Management Mohamed Firouz Asnan, Petros chairman Tan Sri Datuk Amar Hamid Bugo, and State Secretary Datuk Amar Jaul Samion.