Sarawak increases O&G stake

Posted on : 14 Apr 2018  Source of News: borneo post online

State holds second largest block in LNG Tiga through acquisition of Shell’s 15 pct stake in the company

Abang Johari (centre), flanked by Wong (second right) and Dr Rundi (left), witnessing Lo (right) and Ahmad Tarmizi exchange the signed acquisition documents. — Photo by Chimon Upon

KUCHING: The state government has acquired from Shell Gas Holdings (Malaysia) Limited, a subsidiary of Royal Dutch Shell plc, a 15 per cent equity interest in Malaysia LNG Tiga Sdn Bhd (MLNG Tiga).

The acquisition was made through the Sarawak State Financial Secretary (SFS), which is also an existing MLNG Tiga shareholder with 10 per cent shareholding.

Upon completion of this acquisition, SFS now holds the second largest block, having increased its shareholding in MLNG Tiga to 25 per cent.

The other shareholders of MLNG Tiga are Petronas with 60 per cent equity, Nippon Oil Finance (Netherlands) B.V. with 10 per cent equity, and Diamond Gas (Netherlands) B.V, a Mitsubishi Corporation subsidiary, with 5 per cent equity.

Malaysia LNG Sdn Bhd, a Petronas subsidiary, operates MLNG Tiga as part of the larger Petronas LNG Complex in Bintulu.

Chief Minister Datuk Patinggi Abang Johari Tun Openg announced the acquisition and witnessed the signing ceremony on the state’s acquisition held here yesterday.

Speaking at a press conference after the ceremony, the Chief Minister said the acquisition was another success story of the government as it was part of the state government’s strategic investment in oil and gas.

“When I said we will participate actively in oil and gas I mean I walk the talk. But it must be talked thoroughly within the confines of our constitution as well as our written laws.

“We will participate step by step and with that sort of approach I believe that in a short term we will be able to explore new areas where Sarawak will participate in
both downstream and upstream in the oil and gas industry within the confines of our laws,” he said.

In the process, he said the state would continue to invest for the long term interest of Sarawak, adding that the state government would work together with oil companies including Petronas and international companies.

He assured that in July the state would upgrade its oil mining ordinance that has not been repealed, adding that this mining ordinance would empower the state to participate in the oil and gas industry.

He expected a healthy and sustainable return of investment to the state’s overall revenue following additional investment in MLNG Tiga, together with its existing investments in Bintulu LNG Complex namely in MLNG, MLNG Dua and the coming Train 9.

On the dividend the state had received from LNG, Abang Johari said since LNG started until 2017, the state had received an accumulated dividend amounting to almost RM20 billion.

“We are going to get more after this because we have got 25 per cent shareholding in MLNG Tiga,” he said.

The Chief Minister said the state was also ready to buy Petronas’ blocks if they intend to divest.

“But I don’t think they want to sell. But if they are willing to divest, we are ready to buy,” he said.

At the signing ceremony, Datuk Iain Lo, chairman of Shell Malaysia, signed on behalf of Shell Gas Holdings (Malaysia) Limited while State Financial Secretary Datuk Sri Ahmad Tarmizi Sulaiman signed on behalf of SFS.

Second Minister of Finance Dato Sri Wong Soon Koh, Minister of Utilities Dato Sri Dr Stephen Rundi Utom and State Secretary Tan Sri Datuk Amar Mohamad Morshidi Abdul Ghani were among those present.