Johor, Amity Energy to build refrigerated LPG terminal in Malaysia

Amity Energy signed a memorandum of understanding with Johor Corp. to build and operate a refrigerated liquefied petroleum gas (RLPG) terminal in the Tanjung Langsat industrial complex, officials announced on Tuesday.

This RLPG terminal will be the first of its kind in Malaysia.

The project involves the construction of a 1-MMtpy throughput RLPG storage and break bulk facility at an estimated project cost of $150 million to $200 million.

Upon completion, the RLPG terminal will be equipped to handle the storage and distribution of propane and butane, with direct connectivity to the deep-water berth facility capable of receiving very-large gas carriers.

The RLPG terminal is expected to be operational in the first quarter of 2018. Amity Energy says it is in the final stages of discussion with potential customers and expects to have final investment approval by end of July 2016.

“There is significant demand by international oil companies for an independent RLPG break bulk terminal in South East Asia," said Nasrat Muzayyin, chairman of Amity Energy. "We project a significant increase of LPG imports from North America and Middle East to Asia.

"The cost effective and efficient distribution of imported LPG to the South Asia markets requires a break bulk terminal along the major international shipping lanes," he continued. "Tanjung Langsat Port is ideally located to provide this service.

"We anticipate some of the LPG will be sold domestically with the majority being sold by our customers in smaller pressurized vessels to markets such as Bangladesh, Sri Lanka, Myanmar, Philippines, Vietnam and Indonesia."

During the engineering, procurement and construction phase, about 800 workers of varying skills will be directly employed on this job. Local suppliers for material and construction equipment will also be utilized, while 100 permanent highly-skilled management and professional jobs will be created for the operation of this RLPG terminal.

The facility will also tap on the local market for ancillary engineering, labor support services and supplier contract work during operations, creating indirect employment of more than 100 new jobs.

The second phase of the storage complex will include a petroleum products (fuel oil, gasoil, naphtha and gasoline) storage terminal with a capacity of 400,000 m3 at an additional cost of $150 million to $200 million.

This will be considered as the Phase 2 expansion, and will create significant employment during construction of about 1,000 people, and another 60 new permanent jobs during operations.

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