To meet this growing latent gas demand, a liquefied natural gas (LNG) regasification terminal will be built to treat imported LNG. To make gas imports economically feasible, the gas will be sold at a liberalised and unsubsidised price.
This regasification terminal is expected to contributing of the increase in Malaysia GNI as it will supply gas to companies that previously did not invest in Malaysia due to lack of gas supply would.
It would provide RM8 billion GNI increase and will create 27,000 new jobs.
The operation of the terminal and transmission pipelines will generate an additional RM0.6 billion in GNI to Malaysia.
The plant, which has reached its mechanical completion, will be undergoing various testing before receiving its first LNG shipment at the end of August.
Petronas Gas managing director and chief executive officer Samsudin Miskon said at a media briefing (early June 2012) that the company was in talks with several parties that were interested in using facility.
Samsudin said the liberalisation of the gas sector allowed any third party to bring in gas supply for themselves or for clients.
Currently, 100% of the capacity at the LNG regasification would be taken up by Petronas Gas.
However, he said the company was willing to scale down the capacity for any third party interested in using its facility.
In anticipation of third-party access, Petronas Gas had published the Petronas Gas Network Code in December 2011.
The code will govern the use of the terminal and the pipeline network to ensure discipline and fairness among users so that customers are well-served.
The project was officially announced by the Prime Minister on June 10, 2010 under the 10th Malaysia Plan.
The LNG regasification terminal is situated three kilometres offshore Sungai Udang, Melaka
The terminal managed by Regas Terminal (Sg Udang) Sdn Bhd, incorporated in December 2011 as a wholly owned subsidiary of PETRONAS Gas Berhad (PGB).
The facilities at Sungai Udang have a maximum capacity of 3.8 million tonnes per annum.
There will be subsea and offshore pipelines to transport the regasified LNG to the Peninsular Gas Utilisation (PGU) pipeline network, about 30 kilometers away from Sungai Udang.
The project was developed in anticipation of future increase in gas demand in the face of depleting indigenous gas reserves, as part of PETRONAS’ efforts to ensure sufficient and secure natural gas supply for Malaysia.
Its implementation has also enhanced the capability of the local players involved in the project, exposing them to new technologies and expertise that would be beneficial to their growth and the development of Malaysia’s oil and gas industry.
LNG stands for Liquefied Natural Gas – natural gas in its liquid state.
Natural gas becomes LNG when it’s cooled to around -160ºC at atmospheric pressure.
The transformation in state results in significant volume reduction, paving the way for the long haul transportation of larger quantities.
Regasification is a simpler process than liquefaction. The regasification process falls into the framework of what is known as the “Gas Chain”.
Simply put, the LNG is heated up until it returns to a gaseous state.
In regasification terminals, the liquefied natural gas is returned to its initial, gaseous state, and then fed into transmission and distribution networks.
LNG transportation tanks are well insulated to keep the LNG temperature down below -161º, ensuring the LNG retains its liquid form.
Following transit, the LNG is pumped out of the tanks and warmed until it returns to natural gas.
Source: Pemandu; ETP ANNUAL REPORT 2011; PETRONAS; PetGas LNG regasification terminal draws interest – The company is in talks with several parties, says CEO, The Star, 1 June 2012
(this article written for 1BINA.my)