Piasau Gas to gain from Sarawak’s natural gas resources
KUCHING: Piasau Gas Sdn Bhd, which is set to be acquired by Shin Yang Shipping Corp Bhd (Syscorp), plans to build a compressed natural gas (CNG) plant to take advantage of the abundance of Sarawak’s natural gas resources.
When built, the plant will compress natural gas into long tube tankers for distribution to various oil palm estates and industrial plants, according to Syscorp director Koh Ek Chong.
He said Piasau Gas is currently undertaking a study on the CNG project.
“Piasau Gas has not identified any possible joint venture with any potential parties to build the CNG plant at the moment,” he said in a circular to shareholders on the proposed acquisition of Piasau Gas by Syscorp for about Rm22.8mil in cash.
Syscorp is seeking shareholders’ green light for the proposed acquisition during an EGM in Miri on May 30, 2022.
Piasau Gas is principally engaged in the manufacturing, distribution and marketing of industrial gases, provision of services and maintenance and trading in welding equipment and machinery.
Koh said Syscorp intends to expand Piasau Gas’s business by venturing into the distribution of liquified petroleum gas (LPG) throughout Sarawak by leveraging on the group’s existing operating offices and warehouses in Kuching, Sibu, Bintulu and Miri, as well as various reachable quarry and reforestation depots.
“In line with the expansion plan, Piasau Gas is making preparations to apply for a dealership of LPG from Petroleum Sarawak Bhd,” he added.
Koh said the set up of the Sarawak Medical Innovation and Technology Hub (Smith) in Tanjung Kidurong, Bintulu represents another watershed moment for Sarawak’s medical manufacturing and pharmaceutical industries, adding that this is expected to further propel the growth of the liquid oxygen market in the state.
Smith is a joint project by Sarawak Economic Development Corp, Arrow Medsource Group from the United States and several other global partners. The project is currently under construction.
Sarawak Premier Datuk Patinggi Abang Johari Tun Openg said recently that a Us-based healthcare company will be investing Rm1bil to produce medical products in Smith, adding that the company is now implementing its first phase project estimated to cost Rm200mil, to be followed by another Rm800mil investment in the second phase.
Koh said Petroliam Nasional Bhd had recently signed production sharing contracts for five offshore exploration blocks, which would attract some Rm600mil in exploration activities in Malaysia.
The blocks are located off the coast of Sabah and Sarawak.
“The new oil field exploration is expected to increase the demand for liquid oxygen and nitrogen,” said Koh.
Koh said the proposed acquisition of Piasau Gas is expected to strengthen and complement Syscorp group’s shipbuilding activities and expand Piasau Gas’s other products and services to the group’s clientele both locally and globally, especially in relation to the shipbuilding business.
“It will also enable Syscorp group to reduce the reliance on any external source of liquified oxygen and nitrogen gas service providers on pipeline purging, cylinders hydrostatic testing, installation of applicable refilling station for oxygen, nitrogen and argon and cylinder racks with 16 to 20 cylinders manifolds.”
Koh said Syscorp group, which is engaged in container, dry bulk and chemical shipping activities besides shipbuilding and repair businesses, expects the industrial gas business to continue its upwards trajectory and is optimistic that it will pave the way to better earnings sustainability for the group.