Posted on 03 Mar 2025
Sabah reached another milestone when Sabah Energy Corporation Sdn Bhd (SEC) signed a deal with PETRONAS to supply natural gas valued around RM1bil annually to Esteel Enterprise Sabah Sdn Bhd.
The agreement will see the wholly-owned state government-linked company supplying 150 million standard cubic feet per day (MMscfd) of natural gas, 100 MMscfd for manufacturing and 50 MMscfd for power generation to the green steel company.
“This agreement marks a significant step towards Sabah’s long-term development goals, promoting industrial growth and energy security and creating new opportunities to drive Sabah’s progress,” said Chief Minister Datuk Seri Hajiji Noor.
“We look forward to further collaboration with PETRONAS, taking into account the best interest of Sabah,” he said after witnessing the exchange of agreements between SEC and Petronas as well as SEC and Esteel at Menara Kinabalu here, Friday.
He said the state was also ready to cater to the growing industrial needs and investments and had put in place plans to improve infrastructure and facilities to complement these initiatives.
In the agreement between SEC and PETRONAS, the national petroleum company would supply an additional 104 MMscfd of natural gas to SEC to support Sabah’s industrial and energy needs.
With the increased supply of natural gas, PETRONAS is now supplying a total of 370MMscfd to SEC.
Representing PETRONAS was Senior General Manager of Malaysia Petroleum Management’s Integrated Hydrocarbon Management, Anuar Ismail, while chief executive officer, Datuk Adzmir Abdul Rahman represented the SEC.
Commenting on the agreement, senior vice president of MPM, Datuk Bacho Pilong said it underscored Petronas unwavering commitment to providing reliable energy solutions that contribute to Sabah’s growth while supporting more sustainable energy use.
Committed to best industrial practices, SEC maintains a 98% gas delivery efficiency uptime and continuously enhances its technical capabilities and operational efficiencies to drive growth in the energy sector.
Expected to be operational by the fourth quarter of 2027 on a 180-hectare site, phase 1 of Esteel’s green steel plant, with an investment of USD1.93bil (RM8.92bil), would create 2,795 direct job opportunities and produce 2.5 million tonnes of cleaner hot briquetted iron.
The three-phased project brings in an estimated USD4.39bil (RM19.6bil) investment.
The plant opted for natural gas as a reducing agent instead of coke and coal, reducing carbon emissions by 70% and making it low carbon, efficient, and environmentally friendly.
Earlier, Hajiji also said that this marked Sabah's confidence in the green steel project, which is among investments that represented the foundation of the state's economic growth and development strategy.
Source:The Star
