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SEC seals multiple natural gas sales agreements with major investors


Chief Minister Datuk Seri Panglima Haji Hajiji Haji Noor (standing centre) witnessing the exchange of documents between SEC and SBH-Kibing Solar New Materials (M) Sdn Bhd.

KOTA KINABALU (Mar 6): Sabah’s largest domestic supplier and transporter of natural gas, Sabah Energy Corporation Sdn Bhd (SEC) has signed multiple Natural Gas Sales Agreements (GSAs) and a Heads of Agreement (HOA) with major investors in the state.

Chief Minister Datuk Seri Panglima Haji Hajiji Haji Noor said with these signings SEC is now playing an integral role in supporting the growth of industries and economic development in Sabah.

Hajiji was glad to note the State Government’s effort to play a lead role in the gas industry through its wholly-owned company, SEC is now bearing fruit following the signing of the agreement with Petronas in October last year, giving the SEC selected downstream gas pipeline assets and supply of natural gas contracts.

SEC is expected to take over the natural gas pipeline from Petronas beginning April 1 this year.

“This augurs well for the state’s economic growth in line with the GRS-led State Government’s aspirations under its Sabah Maju Jaya initiatives,” he said after witnessing the GSAs and HoA signing ceremony at Menara Kinabalu near here on Monday.

The first GSA was a long-term Gas Sales Agreement (GSA) between SEC with SBH- Kibing Solar New Materials (M) Sdn Bhd for their silica sand processing and solar panel manufacturing project. SBH Kibing is investing RM2 billion in Sabah, which is expected to bring huge benefits to the State in terms of an increase in foreign direct investment, about 1,800 employment opportunities for Sabahans, and other tangible economic spin-offs.

SEC also signed the GSA with SK Nexilis Malaysia Sdn Bhd, a leading manufacturer of copper foil for batteries and flexible Copper Clad Laminate for the display parts industry. The company’s investment of RM4.2 billion in building its first overseas copper foil manufacturing facility at the Kota Kinabalu Industrial Park (KKIP) is part of Sabah’s efforts to promote non-power sector industries in the state and position the state as a hub for electric vehicle (EV) components.

The manufacturing facility at KKIP is expected to create some 500 job opportunities.

SEC has also signed a Gas Sales Heads of Agreement with Petronas Gas Berhad’s subsidiary, RGTLD, for the supply of natural gas.

Through this long-term gas supply agreement, SEC will undertake the role of a gas supplier to the recently-announced RM230 million plant project at Sipitang Oil and Gas Industrial Park (SOGIP) in Sipitang.

The plant, targeted to be completed in the first quarter of 2026, will play an integral role as the sole energy supplier to the state’s first nearshore 2.0 million tonnes per annum (MTPA) floating liquefied natural gas facility. This plant also serves as a potential heat source for future consumers in SOGIP.

On Jan 17, 2023, SEC also concluded the Natural Gas Sales Novation Agreement with Petronas, Petronas Carigali Sdn Bhd, and existing Independent Power Producers (IPPs) with a total capacity of 880 MW.

The novation agreement marked the significance of the State-owned company as the major natural gas supplier for the power sector. Representatives from the IPPs, namely Kimanis Power Plant Sdn Bhd, SPR Energy (M) Sdn Bhd, Ranhill Powertron Sdn Bhd, Ranhill Powertron II Sdn Bhd and Sepangar Bay Power Corporation Sdn Bhd were present to receive the signed documents from SEC.

Present were State Secretary Datuk Seri Panglima Sr Safar Untong, State Attorney- General, Datuk Nor Asiah Mohd Yusof, SEC Chairman Datuk Anwar Ayub and SEC Chief Executive Officer Adzmir Abdul Rahman.

Adzmir when met after the ceremony, explained that SEC will only be taking over the ‘branches’ out of the main natural gas pipeline from Petronas.

“This means from Kimanis to the two IPPs there and the other one to SAMUR which is about 12 km. Our focus is on the strategy of M&A, Merger and Acquisition. We want to make sure that whatever asset we take over will provide us with the returns. That is our priority,” he said.



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