MLNG Tiga to Supply LNG to KOGAS
Malaysia LNG Tiga Sdn Bhd (MLNG Tiga) today signed a Sale and Purchase Agreement (SPA) with Korea Gas Corporation (KOGAS) to supply up to two million tonnes per annum of liquefied natural gas (LNG) for 20 years beginning 2008, with an option to extend for another five years. KOGAS has selected MLNG Tiga as one of its preferred suppliers from 12 bidders that participated in a tender exercise carried out by the South Korean importer late last year.
The LNG will be supplied to KOGAS from the PETRONAS LNG Complex in Bintulu and will be transported to KOGAS receiving terminals in Pyeong Taek, Incheon and Tong Young in South Korea by LNG vessels owned and operated by Malaysia International Shipping Corporation Bhd.
KOGAS is currently the single largest LNG importer in the world, importing close to 20 million tonnes per annum. With today's signing, KOGAS became the largest LNG importer from Malaysia LNG Companies with a total amount of 6.7 million tonnes per annum. Malaysia LNG Companies will supply approximately 24% of the total volume of KOGAS import estimated to be around 25 million tonnes in 2008.
The relationship between Malaysia LNG Companies and KOGAS started in 1991 with sales of spot cargoes, followed by a long-term contract signed in 1993 for two million tonnes per annum. The volume was further expanded to 6.7 million tonnes per annum following the award of medium-term and short-term supply contracts in 2003 and 2004 respectively, and today's long-term contract.
MLNG Tiga is a joint venture between PETRONAS (60%), the Sarawak State Government (10%), Shell Gas BV (15%), Nippon Oil LNG (Netherlands) BV (10%) and Diamond Gas Netherlands BV (5%). The MLNG Tiga plant comprises two liquefaction trains with an annual production of 3.4 million tonnes each and commenced operations in 2003.
The MLNG Tiga plant with two other plants owned by Malaysia LNG Sdn Bhd and Malaysia LNG Dua Sdn Bhd boosted the LNG production capacity to about 23 million tonnes per annum making the PETRONAS LNG Complex in Bintulu the world's largest LNG production facility in a single location.
At the SPA signing ceremony held in Kuala Lumpur today, MLNG Tiga was represented by its Chairman, Tan Sri Dato Sri Mohd Hassan Marican while KOGAS was represented by Mr. Lee Kyu-Sun, the Acting Chairman, President and CEO.
Also present at the ceremony was Dr. Toh Kyung-Hwan, the Director of Gas Industry Division, Ministry of Commerce, Industry and Energy of the Republic of Korea.
Media Relations Department
12 July 2005