Malaysia gas and LNG: 2016 long-term regional outlook
Domestic supply projects continue to progress. Additional gas from the North Malay basin and MTJDA B17 has started supplying the gas market in Peninsular Malaysia. In East Malaysia, the Sabah-Sarawak gas pipeline resumed operations in early 2016, delivering gas from Sabah to Bintulu LNG. The MLNG Train 9 and PETRONAS FLNG 1 projects are progressing as planned, targeting late-2016 start-up. We expect LNG output to be maintained at 32 mmtpa in the long term. On the demand side, Peninsular Malaysia's power sector is shifting toward coal, causing a drop in gas demand for power in the short to medium term. The RAPID integrated industrial projects will help offset this decline. In June 2016, the Malaysian parliament approved the Gas Supply (Amendment) Act 2016, allowing third party access (TPA) to be implemented. This will introduce competition in the LNG import sector. Gas price reform continue to progress, with another price increment for TNB and Gas Malaysia in July 2016.