The allocation is meant for the development of the common tankage facilities with shared infrastructure
by S BIRRUNTHA/ pic credit: DocPlayer.net
DIALOG Group Bhd has allocated a RM2.5 billion capital expenditure (capex) for its currently ongoing Pengerang Deepwater Terminals (PDT) Phase 3 development which is targeted to be completed by 2021.
Its executive deputy chairman Chan Yew Kai (picture) said the allocation is meant for the development of the common tankage facilities with shared infrastructure as well as Jetty 3.
“We have commenced construction for a storage terminal, common tankage facilities with shared infrastructure and deep-water marine facilities at Jetty 3, for Phase 3. Alongside this, we have signed a long-term storage agreement with BP Singapore Pte Ltd that is expected to be commissioned in mid-2021,” he said at a media briefing after the company’s AGM in Kuala Lumpur yesterday.
Chan said the total storage capacity for Phase 3 is about 430,000 cu m and the company is currently working on Phase 3A.
“For Phase 3, we have another 500 acres (202.34ha) of land for expansion and we believe that the land is enough for another 10 to 15 years of expansion,” Chan said.
He added that the remaining 500 acres of land, comprising reclaimable land and the buffer zone, has already been earmarked for the further development of Phase 3 and future phases.
“Together with our partners, we are strongly committed to developing a vibrant petroleum downstream manufacturing centre. We realise that our collective vision is transforming PDT into an international petroleum and petrochemical hub of the future,” Chan said.
He said the land reclamation activity for Phase 3 has remained on track for completion at the end of 2019 and it would involve an area of about 300 acres.
“The group will continue to actively pursue potential customers for Phase 3, which will consist of dedicated petroleum and petrochemical storage terminals for medium to long term clients, including refinery and petrochemical plants,” he said.
Phase 1 of the Pengerang project is claimed to be an independent tankage, which has a high utilisation rate. The land under Phase 1 is still available for future expansion.
The project — which has a dedicated deep-water jetty facility — commenced operation in April 2014 and is currently being expanded by another 430,000 cu m.
Meanwhile, Phase 2 is dedicated to Petroliam Nasional Bhd, but there is ample land for additional tanks to be set up in the land.
The storage capacity for Phase 2A and 2B is 1.3 million and 400,000 cu m respectively.
“We have been receiving the contribution from Phase 2 since 2017, which is the crude oil and naphtha tanks.
“Phase 2 is not fully completed. It is still yet to be finished by the end of this year. At the moment, 90% of it has been completed and utilised,” Chan said.
Apart from the Pengerang project, Chan said the group has also been eyeing to acquire Malaysian brownfield oil and gas (O&G) assets to grow the company’s upstream business.
It is to account for at least onethird of the O&G support services provider’s net profit from the current 20%.
Dialog executive chairman Tan Sri Dr Ngau Boon Keat said it is now a good time for asset acquisitions due to the lower crude oil prices.
“There is a balanced contribution from all three segments upstream, midstream and downstream which allows us to better fence against the volatile O&G market.
“Our midstream and downstream businesses currently contribute about 40% each to the group’s bottom line,” he said.
Ngau added that there will be quite a lot of assets up for sale as oil majors move back to the US.
“Here, although the old fields are not so interesting to them, they appear very interesting to us. We are actively looking, but nothing is definite yet. We will announce when we are sure,” he said.