Sabah’s first nearshore liquefied natural gas development achieves final investment decision
KOTA KINABALU,. Petroliam Nasional Bhd (Petronas) has reached the final investment decision (FID) for a nearshore liquefied natural gas (LNG) facility in Sabah.
The engineering, procurement, construction and commissioning (EPCC) contract for the project was awarded to the winner of the dual front end engineering design (FEED) competition in October last year.
Sabah Chief Minister Datuk Seri Hajiji Noor said the LNG project is a step in the right direction as the state government continues to pursue more deals to get additional revenue via equity participation for Sabah.
“The nearshore LNG project is an outcome of a joint study between the state government and Petronas to identify optimal gas monetisation options in order to maximise long-term economic spin-offs that will benefit the people of Sabah,” he said in a joint statement with Petronas chief operating officer, Adnan Zainal Abidin today.
The FID and the award of the EPCC contract marked another significant milestone for the project located at the Sipitang Oil and Gas Industrial Park, where it is expected to produce two million tonnes per annum of LNG.
The facility is scheduled to achieve commercial operations by the second half of 2027.
Meanwhile, Adnan, who is also the executive vice-president and chief executive officer of Petronas Gas Business, said that in view of the transition towards a low-carbon future, Petronas will continue to advocate greater use of natural gas.
“The development of the facility under the Sabah Gas Masterplan will strengthen both the position of the state and Malaysia as a whole as an attractive natural gas hub, contributing to the mutual prosperity of Sabah and the nation.
“We will leverage our technological expertise for the development of the project to unlock gas resources in an optimised and environmentally-friendly manner,” he said, adding that Petronas remains resolute in supporting the Sabah state government’s aspiration for its oil and gas industry.
The nearshore LNG facility will expand Petronas’ global portfolio of LNG assets, further strengthening the company’s position as one of the world’s largest LNG providers.