RM8.88 bln energy hub project to transform Sabah’s oil and gas sector
- Feb 13, 2025
- 3 min read
By Mariah Doksil on February 11, 2025, Tuesday at 4:07 PM
KOTA KINABALU (Feb 11): Sabah is set to solidify its position as a key player in Southeast Asia’s energy landscape with the launch of the RM8.88 billion (USD2 billion) Oil and Gas, Energy Hub Project at the Sipitang Oil and Gas Industrial Park (SOGIP).
Chief Minister Datuk Seri Panglima Hajiji Noor said the project marks a significant milestone in Malaysia’s energy and industrial strategy, setting the stage for long-term economic growth, job creation and technological advancement in the region.
“SOGIP will serve as a catalyst for further expansion in the energy sector, which is crucial for Sabah’s sustained economic development. Most importantly, this project will create more opportunities for collaboration, innovation and investment in the oil, gas and energy industries — directly benefiting both businesses and local communities,” he said during the launch at the Sabah International Convention Centre (SICC) on Tuesday.
Hajiji highlighted that the SOGIP development will emphasize environmental sustainability as part of Malaysia’s commitment to a lower-carbon future.
“As the nation moves toward reducing its carbon footprint, the integration of cleaner energy sources, such as liquefied natural gas (LNG), will be crucial in Malaysia’s energy transition strategy,” he said.
He added that the energy storage and distribution systems within SOGIP are being designed to support the country’s long-term renewable energy goals.
“By ensuring a steady supply of natural gas and other lower-carbon fuels, SOGIP can help bridge the transition from fossil fuel dependency to greater adoption of renewables like solar and wind power in Malaysia’s energy mix,” he explained.
The Oil and Gas, Energy Hub Project is a collaboration between the Sabah Oil and Gas Development Corporation (SOGDC) — which manages SOGIP — and Gibson Shipbrokers Limited, a global leader in maritime, energy and industrial services.
The project, which will be developed in two phases, includes the construction of a state-of-the-art port to enhance energy transportation and trade activities.Notably, 80 per cent of the workforce involved in the project will consist of local talent, reinforcing the state’s commitment to job creation and skills development.
Hajiji emphasized that the successful implementation of the project will not only boost Malaysia’s domestic economy but also strengthen regional energy security and enhance international trade.
“With strong support from both private sector partners and the government, SOGIP is expected to attract additional investments in energy infrastructure, technological advancements and industrial expansion.
“As Malaysia strengthens its presence in global energy markets, this project will play a strategic role in driving economic resilience, energy independence, and sustainable industrial growth,” he said.
Beyond economic benefits, Hajiji assured that the project would create vast employment opportunities, skills training programmes and community empowerment initiatives.
“I have always emphasized the importance of prioritizing the employment of Sabahans in all projects and operations within the state. Industry players must comply with this fundamental requirement as part of our commitment to local development,” he stated.
To reinforce this commitment, the Sabah Local Content Council was established through SMJ Energy in May 2024 as a collaborative platform for industry stakeholders to enhance local content development in the oil and gas industry.
“Through this platform, the State Government will mandate all stakeholders to invest in the training and development of Sabahans, with structured short-term and medium-term programmes set to roll out in 2025,” Hajiji added.
Hajiji reaffirmed that the State Government’s unwavering commitment to the progress and development of Sabah’s oil and gas industry.
“Through continued collaboration and mutual support, we can further strengthen Sabah’s position in the energy sector, driving greater economic prosperity and sustainable industrial growth for our state,” he said.
With the launch of the Oil and Gas, Energy Hub Project, Sabah is poised to become a major regional hub for energy production, innovation and investment, ushering in a new era of economic transformation for the state.
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