OIL, GAS & ENERGY SECTOR

UPSTREAM/MIDSTREAM

EPP 1 : LAHAD DATU REGASIFICATION TERMINAL (LD RGT)

DESCRIPTION To develop a facilities to receive, store and vaporize imported LNG with a maximum capacity of 0.76 MTPA (up to 100 mmscfd) and supply the natural gas to the Power Plant

lahad datu

Berth

LNG Storage Tank (0.76 MTPA) Vaporization Station

Jetty
Key outcomes of the EPP / KPIs
Availability of natural gas supply at east coast of Sabah including Sandakan, Lahad Datu and Tawau (also along the route) Transfer of technology and knowledge to local manpower and contractors who are involved with this project Spurring the economy along the pipeline

What needs to be done?

Construction period of LNG Storage Tank which is the critical path of the project (normally will take up to 24 months) Front End phase of a project, where activities are mainly focused towards project planning and contracting/bidding activities for the appointment of Frond End Engineering Design Consultant expected in mid-October 2011 Evaluate and finalize the land lease of the reclaimed land of the proposed site with POIC. Site Reclamation works is expected to start by Q1 2012

Key Challenges
Transporting major equipment and bulk materials from Sandakan to Lahad Datu (~200km) Shortage of capable manpower due to simultaneous construction of LD power plant Available manpower are lack of re-gas terminal construction skills (special) Potential security threat with historical events of pirates attack towards workers and equipment Coordination for safety and evacuation during emergency with local authorities

Mitigation Plan
Improvement of the road condition from Sandakan to Lahad Datu or consider for permanent/temporary jetty at Lahad Datu Proper education planning to prepare and develop the skilled and semi skilled manpower Collaboration with state authorities to tighten the security along the coast lines

UPSTREAM/MIDSTREAM

EPP 2 : SABAH O&G TERMINAL (SOGT) AND SABAH - SARAWAK PIPELINE (SSGP)
DESCRIPTION 512 km Sabah Sarawak Gas Pipeline connects Kimanis to Bintulu (Pipeline in Sabah: 91.24km). A branch line will be constructed to cater for SOGIP in Sipitang Terminal to receive and process oil and gas from off shore (Kinabalu, Gamusut, etc) in Kimanis Oil Terminal: 2.5 mboe Gas Terminal: 1,250 mmscfd Project Status SOGT: On-going construction SSGP: Land acquisition and pipe construction

kimanis

Key outcomes of the EPP / KPIs

Availability of natural gas supply at SOGIP and spur the huge potential of petro-chemical industry Transfer of technology and knowledge to local manpower and contractors who are involved with this project Spurring the economy along the pipeline

What needs to be done?

Continue with the construction Continue with land acquisition and networking with Land and Survey Department of Sabah, UPEN Sabah and District Offices

Key Challenges
Acquisition of land for right of ways (ROW) Shortage of capable manpower and local contractors Potential security threat manpower and equipment towards workers and equipment from unhappy squatters

Mitigation Plan
Collaboration with Land and Survey Department to speedup the large number of documentations due to large number of private land owners Proper education planning to prepare and develop the skilled and semi skilled manpower Collaboration with state authorities to tighten the security along the coast lines

OIL, GAS & ENERGY SECTOR

UPSTREAM/MIDSTREAM

EPP 3 : GAS SEPARATION PLANT AT KIMANIS (GSP)

DESCRIPTION To design and built an LPG extraction plant and its export facilities to enhance the value of Sabah gas at Sabah O&G Terminal (SOGT)

Key outcomes of the EPP / KPIs

Additional GDP of RM29,560 million to Sabah from that sales of C3 and C4 on top of C1 and C2. This extension will help to expedite the growth of KKIP Industries along the pipeline can also benefit from the spin off from extension of the pipeline.

kimanis

What needs to be done?

Feasibility Study: 3 months Detailed Feasibility Study: 9 months Basic Engineering Design: 12 months EPCC: 24 months Total duration: 4 years to complete

Pipeline from Offshore

Industries
New Transmission / Distribution Pipeline

Key Challenges
Choosing the compatible system for GSP to connect with SOGT system Laying the 75km pipeline from GSP at Kimanis to Industries which mostly will be located at Kota Kinabalu and SOGIP

Mitigation Plan
Proper feasibility study on designing the GSP Collaboration effort between SEC, PETRONAS and Sabah State Authorities (i.e. Sabah Land and Survey Department and UPEN Sabah)

SOGT GSP

SSGP

Bintulu

Sales will be transmitted

DOWNSTREAM

EPP 4 : KIMANIS POWER PLANT (300MW)

KIMANIS POwer SdN Bhd

DESCRIPTION Kimanis Power Plant will address the immediate needs of electricity demand in Sabah (especially in West Coast)

Capacity Fuel Off-taker

300 MW Natural Gas (60 mmscfd) SESB

kimanis

Key outcomes of the EPP / KPIs

Creation of 415 jobs for Sabahan from top management to supporting staff during operations and 2100 jobs during construction. Hence, transfer of technology and knowledge will take place to local manpower and contractors Additional 300 MW of cleaner and stable energy supply into SESB to preserve Sabah eco treasure Reduce the yearly lost from industrial losses RM4.59billion/per year due to power interruption

What needs to be done?

Complete construction of site office by Q1 2012 Proceeds with construction once the land work completed Ensure the completion of SOGT project Ensure the completion of SESB transmission facility upgrade

Key Challenges
Lengthy negotiation period on Power Purchase Agreement (PPA) Shortage of capable manpower and local contractors

Mitigation Plan
Pending MPRC discussion outcome Proper education planning to prepare and develop the skilled and semi skilled manpower

OIL, GAS & ENERGY SECTOR

DOWNSTREAM

EPP 5 : LAHAD DATU POWER PLANT (300MW)

DESCRIPTION The fuel for the power plant will be LNG The power plant and LNG re-gasification plant are to be built in POIC Lahad Datu Phase 3
Fuel Off-taker

LdPP
Capacity 300 MW Natural Gas (60 mmscfd) SESB

Key outcomes of the EPP / KPIs

Creation of 390 jobs for Sabahan from top management to supporting staff during operations and 2737 jobs during construction. Hence, transfer of technology and knowledge will take place to local manpower and contractors Additional 300 MW of cleaner and stable energy supply into SESB to preserve Sabah eco treasure Reduce the yearly lost from industrial losses RM4.59billion/per year due to power interruption

What needs to be done?

Project consortium needs to Resolve land purchase/ lease matters by Dec 2011 Resolve jetty building and ownership matters between project consortium and POIC / Sabah Authorities by Dec 2011 Project consortium needs to start the land works latest by Q1 2012 MLNG needs to secure the LNG import supplies from international market by 2014

Key Challenges
POIC policy not to sell sea front land and project owner plan to purchase the land for jetty and port to lower the project cost and ensure the security of long term investment POIC policy for them to build and operate the jetty vs project owner plan to self build and self operate the jetty to reduce cost Lengthy negotiation period on Power Purchase Agreement (PPA) Shortage of capable manpower and local contractors

lahad datu

Mitigation Plan
Work on the agreed price for both parties whether on selling/purchasing or leasing the land Speed up state government decision on the ownership of the jetty Intervention from MPRC, state government into the negotiation of PPA to speed up the decision Proper education planning to prepare and develop the skilled and semi skilled manpower

DOWNSTREAM

EPP 6 : SIPITANG OIL & GAS INDUSTRIAL PARK (SOGIP)

DESCRIPTION Phase 1 - SAMUR (1.25 mt/year urea production) 620 acres To provide the necessary infrastructure (basic road, drainage, water supply & compound lighting) required for the development of SAMUR Phase 2 Mitsui ( 1.0 mt/year ammonia production) 690 acres To provide the necessary Infrastructure (basic road, drainage, water supply & compound lighting) required for the development of ammonia plant Phase 3 - Development of basic infrastructure for 3,000 Acres of Industrial Land
Phase 1 Development Plan Key outcomes of the EPP / KPIs
To accelerate Industrial development in Sabah To create job opportunity and contribute to GDP growth Designated area for oil and gas Industry Cooperation and synergy with Bruneis PMB development Synergy with Asean Supply Base (ASB) in Labuan Contribute to the local job market

Phase 2 Development Plan Key outcomes of the EPP / KPIs

To accelerate industrial development in Sabah To create job opportunity and contribute to GDP growth To make ammonia available at average of 957,000 mt/year as raw feedstock to be used by various industries to produce products such as acrylonitrile, capro-lactum, lsocyanae and ammonium nitrate. Contribute to the local job market. Technology transfer through joint venture with Orica Limited (Australia)

What needs to be done?

To provide basic infrastructure in the area (access road & water). Vendor development programme to be designed for the project. To have programme for participants in order to acquire skills & knowledge beyond those required. Light and medium fabrication Integrated logistics centre Fully equipped logistics facility for storage, transportation, freight forwarding, procurement, customs, immigration clearance, agency related services Supply base function: purpose-built base with office space, workshops, warehouse complex and open yard Storage of OCTG, tubular and heavy equipment

What needs to be done?

To provide basic infrastructure in the area (Access road, water & electricity). Vendor development programme to be designed for the project. To have programme for participants in order to acquire skills & knowledge beyond those required.

SAMUR Project Site

Phase 1 Development Plan

Key Challenges
Lack of basic infrastructure and public amenities such as road, drainage, water & electricity. Identify new potential private sector to utilise ammonia. Need of investment package to attract investors ROW for utilities Better road condition and port facilities to export end products. Accommodation and commercial facilities. Guaranteed gas supply

Key Challenges
Identify new potential private sector to utilise gas, ammonia and urea. Need of investment package to attract investors ROW for utilities Better road condition and port facilities to export end products. Accommodation and commercial facilities

Mitigation Plan
To construct basic infrastructures such as site formation, road, drainage & water reticulation. To provide water supply - 20mld To provide electricity supply- 18 MW Provide 90mmscfd of gas

Phase 2 Development Plan

SOGIP

Phase 3 Development Plan

Mitigation Plan
To construct basic infrastructures such as road & drainage. To provide water supply

OIL, GAS & ENERGY SECTOR

UPSTREAM/MIDSTREAM

EPP 7 : PIPELINE TO KKIP

DESCRIPTION Extension of SSGP tapped from Kimanis end to KKIP Distance: 85km Diameter: 18 Expected Completion: 2015 The extension will pass by Papar Lok Kawi Penampang Kota Kinabalu Expected completion: 2015

85 km Extension Pipeline KK Ppg LK Ppr

KKIP

Propose Extension

Kimanis

SSGP

kimanis

Key outcomes of the EPP / KPIs

With this extension of the pipeline, the secondary recovery of oil wells in ERB West field is possible This extension will help to expedite the growth of KKIP as well as ensure the natural gas supply security to the KKIPs IPPs and small industrial users Industries along the pipeline can also benefit from the spin off from extension of the pipeline

What needs to be done?

Economic studies of the viability of the project by PGB and SEC Collaboration demand projected demand studies between SEC, PGB and KKIP Provision of ROW Syndication with Malaysia Gas Management (MGM) and PETRONAS Carigali Sdn Bhd (PCSB) on the extra allocation of natural gas

Key Challenges
Acquisition of land for ROW Land acquisition for city gate stations No extra gas allocation

Mitigation Plan
Work together with JKR and Sabah Land Authorities to map out common utility corridor or tunnel Work together with Sabah Land Authorities to assist in the acquisition of land in the respective areas/districts for the construction of the city gate station Work with PETRONAS Malaysian Gas Management Unit to secure additional gas allocation