Malaysia LNG Tiga Sdn Bhd (MLNG Tiga) today signed a Sale and Purchase Agreement (SPA) with Japan Petroleum Exploration Co Ltd (JAPEX) to supply up to 480,000 tonnes of liquefied natural gas (LNG) per year to the latter for 20 years beginning from 2003. The contract is valued at about US$1.6 billion.
The SPA firmed up the Confirmation of Intent signed by the two parties in September 1997. Under the terms of the SPA, the LNG will be supplied from Bintulu LNG Complex, Sarawak, and will be delivered to JAPEX by LNG tankers owned by Malaysia International Shipping Corporation Bhd (MISC), a subsidiary of PETRONAS. The first delivery is scheduled to be in early 2003. The LNG will be transported from Malaysia’s LNG loading terminal at Bintulu to the LNG receiving terminal at Seiro-machi, Kitakanbara-gun, in the Niigata Prefecture in Japan.
JAPEX is a semi-government body engaged in oil and gas exploration, development and production activities in Japan and internationally. It also markets crude oil and natural gas in northern part of Honshu to a diverse range of customers in the power generation, chemical, industrial and city gas distribution sectors.
The SPA signed with JAPEX today is the third supply deal to be concluded by MLNG Tiga. In April last year, the company signed a SPA to supply up to 900,000 tonnes of LNG per year to Tohoku Electric Power Co Inc, and earlier this year another SPA was signed for the supply of up to 1.6 million tonnes of LNG per annum to a consortium comprising Tokyo Gas Co Ltd, Toho Gas Co Ltd and Osaka Gas Co Ltd. Currently, MLNG Tiga is in various stages of discussions with a number of potential buyers from traditional and non-traditional markets for its remaining production output.
MLNG Tiga is a joint venture between PETRONAS (60 per cent), Sarawak State Government (10 per cent), Shell Gas BV (15 per cent), Nippon Oil LNG (Netherlands) BV (10 per cent) and Diamond Gas Netherlands BV (five per cent). The MLNG Tiga plant will comprise two liquefaction trains with an annual production capacity of 3.4 million tonnes each. The first train is scheduled to begin commercial operation in early 2003 while the second train in late 2003.
Once operational, the MLNG Tiga plant will make the Bintulu Complex — which already houses two LNG plants — the world’s largest integrated LNG production facility in a single location with a combined production capacity of about 23 million tonnes per annum. Together with ancillary facilities which include six LNG storage tanks, two loading jetties and supported by a fleet of LNG tankers with additional six vessels under construction, the Complex will further enhance Malaysia’s position as one of the world’s largest, flexible and reliable LNG suppliers.
At the SPA signing ceremony held in Kuala Lumpur today, MLNG Tiga was represented by its Chairman Tan Sri Dato’ Mohd Hassan Marican, who is also President and Chief Executive of PETRONAS, while JAPEX was represented by its Chairman Mr Kazuo Wakasugi.
Media Relations & Information Department