Malaysian oil and gas company Petroliam Nasional Bhd., or Petronas, is pushing ahead with its floating liquefied natural gas facility project and will compete with Royal Dutch Shell PLC's (RDSA) proposed floating LNG plant to be the world's first of its kind.
State-run Petronas has made a final investment decision to go ahead with development of a floating LNG facility in Sarawak state on the island of Borneo which it hopes to commission in 2015, the company's chief executive, Shamsul Azhar Abbas, said Monday at the World Gas Conference.
Global demand for gas is on the rise, as it's a cheaper and cleaner alternative to liquid fuels. As conventional fuel reserves are depleting, advanced technology is making it possible to access previously unfeasible resources like shale gas and offshore gas.
Petronas' floating LNG facility project will provide "a strategic solution to monetize marginal and stranded gas fields," the company said in a recent investor review.
Shell is building its floating LNG plant to develop the Prelude gas fields 200 kilometers off Western Australia's Kimberly Coast, which are inaccessible through conventional means.
The Prelude LNG floating terminal is expected to cost around $3 billion-$3.5 billion per one million metric tons of production capacity, equating to $10.8 billion-$12.6 billion, a company executive said earlier.
Six times heavier than the world's biggest aircraft carrier and 488 meters long, Prelude will float in waters off Australia's northwestern coast. It will be capable of producing 3.6 million tons a year of LNG and additional volumes of condensate and liquefied petroleum gas.
The cost of Petronas' proposed floating LNG project in Malaysia isn't known.
Petronas also announced that it had completed construction of the country's first LNG regasification terminal in Melaka, which will start commercial operations in August.
--Eric Yep contributed to this article
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