08 June 2009

Massive oil terminal considered at Pengerang Johor

A Malaysian oil and gas services provider, Dialog, plans to develop a deepwater storage terminal on 500 acres of reclaimed land in Johor, in the south-eastern Pengerang district.
Expected to cost more than US$1 billion, it will be a tank facility for storing, blending and distributing crude oil and petroleum products with port facilities capable of handling Very Large Crude Carriers.

If the project is found to be viable after a six-month feasibility study, including an environmental impact assessment, work would start early next year. The project is expected to take up to 10 years to complete and may be split into three phases.

The project looks to compete with Singapore as a regional fuel-trading hub.

Dialog plans US$1b Johor oil terminal
Business Times 8 Jun 09;
DIALOG Group Bhd, a Malaysian oil and gas services provider, plans to develop a deepwater storage terminal at a cost of more than US$1 billion in Johor state, as it looks to compete with Singapore as a regional fuel-trading hub.

The plan is subject to a minimum six-month feasibility study which is expected to be concluded in the first quarter of next year, said Ngau Boon Keat, Dialog Group managing director and chairman, after signing a preliminary agreement with the state government today.

The proposed terminal, to be built on 500 acres of reclaimed land in the south-eastern Pengerang district, will be a tank facility for storing, blending and distributing crude oil and petroleum products with port facilities capable of handling Very Large Crude Carriers.

Singapore, Asia’s biggest oil trading center and the world’s busiest container port, recently announced the development of underground and floating storage facilities to meet increasing demand as the country lacks land for further expansion capacity, Dialog Group said in a statement.

Those facilities would cost 30 to 50 per cent more than normal above- ground facilities thus making Dialog Group’s terminal competitive, Ngau said.

Dialog Group said it would seek multinational corporations to jointly build, own and operate the terminal. The breakdown of the investment cost will only be known after the feasibility study, Ngau said.

Dialog Group shares rose 0.8 per cent to RM1.25 as of 3pm local time in Kuala Lumpur trading. The stock has risen 56 per cent this year. - Bloomberg

Dialog To Build US$1 Bln Port Facility
Bernama 8 Jun 09;
KUALA LUMPUR, June 8 (Bernama) -- Oil and gas services provider, Dialog Group Bhd, plans to invest over US$1 billion (US$1=RM3.50) to build a storage terminal and port facility in Pengerang, Johor.

Its chairman/group managing director, Ngau Boon Keat, said the project would start early next year once it was found to be viable after a six-month feasibility study, including an environmental impact assessment.

"The project is expected to take up to 10 years to complete. It may be split into three phases and we will be inviting other partners such as multinational corporations involved in oil storage services to build and operate the terminal," he told reporters after the signing of a memorandum of understanding (MOU) with Johor state government and State Secretary Johor (Inc) on the project here Monday.

Also present was Johor Menteri Besar Datuk Abdul Ghani Othman.

Ngau said under the MOU, the parties would form a joint venture company to undertake the development of the terminal on 200 hectares of reclaimed land in south-east Johor.

"It will be the first independent deepwater terminal facility of its kind in South-East Asia," he said, adding that the terminal would be able to accommodate approximately four to five cubic metres of storage.

He said the demand for storage facilities in the region has increased despite the recent financial crisis and the proposed project, located adjacent to Singapore, was timely to meet the demand.

"We are aware that there is inadequate land for further expansion capacity in Singapore. This project will enable Johor to become an important petroleum logistics and trading hub," he said.

Singapore is the region's main hub for petroleum trading in the region.

Ngau said Singapore recently planned to develop underground and floating storage facilities that would cost between 30 and 50 percent more than normal above-ground facilities thus making Dialog's proposed terminal more competitive.

Meanwhile, in a statement here today, Dialog said the proposed terminal would handle, store, blend and distribute crude oil and petroleum products with port facilities capable of handling very large crude carriers with a depth of up to 26 metres.

"This project will be the third major investment after Kertih Terminal and the Langsat Terminal, which will result in an increase in the sources of sustainable and recurring income in the future," it said.


2010 date for Johor oil terminal
Work to start next year if study proves project viable
Pauline Ng, Singapore Business Times 9 Jun 09;
WORK on a US$1 billion independent deepwater petroleum terminal that can accommodate up to five million cubic metres of storage will start at Pengerang, in south-east Johor, by March next year should a feasibility study prove the project viable.

To be located on some 500 acres of reclaimed land between Tanjung Kapal and Tanjung Ayam about 16 nautical miles from Singapore, the Pengerang terminal - backed by the Johor state government and oil & gas company Dialog Group - is aimed at meeting increasing demand for storage facilities which has led players in Singapore to turn to underground and floating storage facilities owing to the lack of land.

Pengerang is expected to be very 'cost competitive' given Dialog's estimations of underground and floating facilities costing 30-50 per cent more.

Because of its water depths of up to 26 metres and port facilities that can cater to Very Large Crude Carriers, the proposed terminal and its tankage facility for handling, storing, blending, and distribution of crude oil and petroleum productions, would appeal to much larger vessels that might not be able to dock at other petroleum hubs in Johor where the waters are less than 20 metres deep, Dialog chairman and group managing director Ngau Boon Keat said at a media conference yesterday.

Earlier, he had inked a memorandum of understanding with the state government to establish the Pengerang petroleum terminal, which Johor chief minister Ghani Othman said the state was committed to developing with the aim of positioning itself as a future petroleum logistics and trading hub.

The state's long coastline, deep waters and proximity to Singapore gave it certain advantages in the area, he said, pointing to a recent shift in investments in the state which has resulted in oil & gas investments surpassing those from electrical and electronics.

Of the RM2.3 billion (S$954 million) secured in the first quarter of the year, RM1.49 billion were foreign direct investments; oil & gas accounted for RM1.14 billion.

'This project is of great significance because not only will it bring in direct capital investments from terminal construction and operations, but it will be a platform to generate growth in trading of petroleum products and other associated services,' Mr Ghani said.

Moreover, it would attract supporting industries and services, creating more jobs and business opportunities.

Although Pengerang is not within the proposed Iskandar Malaysia special economic zone, the Senai- Desaru highway when completed next year would make the area more accessible - as would a proposed third bridge linking Singapore and Malaysia on the eastern side.

Mr Ngau said some oil companies have already expressed an interest in taking up storage space, and depending on the demand, plans to build the facility in phases over 3-10 years.

He said Dialog and the state - which would be an equity partner in the project by way of its land contribution - would consider other partners including multinationals to jointly develop, build and own the terminal.

An integrated specialist technical services provider, Dialog had approached the state government with the proposal. Mr Ngau owns slightly over 26 per cent of the Malaysian stock exchange-listed company, with the state pension Employees Provident Fund the second largest shareholder holding about 15 per cent.

Given that Dialog has experience in such integrated terminals, having invested in the Kertih (Terengganu) and Langsat (Johor) facilities, it is expected to be able to convince oil and gas players to commit to the new plant.

2 comments:

  1. Hi,
    regarding the building of new terminals in Pengerang, may I ask if you have further information in relation to the sea draft and the exact location for development?

    Also, will their be adequate support by the government to provide license and also support infrastructure to develop the land transport network?

    many thanks for your response and any additional links will help too!

    cheers

    ReplyDelete
  2. More information on the project has been provided, updated in this post. http://wildshores.blogspot.com/2011/01/massive-petroleum-terminal-in-johor.html

    ReplyDelete

LinkWithin

Related Posts with Thumbnails