Pengerang Integrated Petroleum Complex boost to Johor ports
Ports in Johor are expected to be the regional champion in terms of cargo handling volume, surpassing any other terminals in the Singapore basin supported by the massive development of Pengerang Integrated Petroleum Complex (PIPC) by 2025, said in the company's press release.
According to Roland Berger Strategy Consultants (Malaysia) managing partner Anthonie Versluis, the Singapore Basin, a natural middle point between two key growth markets - India and China - is an important hub for cargo flows given its strategic location in South East Asia.
Singapore Basin is a term used to describe the terminals within the Singapore catchment areas. It includes all ports in Singapore and Johor as well as Bintan and Batam which are facing the Singapore Straits.
“In general, maritime activity in the Singapore basin will be two to three times from its current size by 2025.
“This global trade shifts to the east will be supported by Asean and China maritime trade, Asean and South Asia maritime trade as well as intra-Asean maritime trade.
“And cargo demand is expected to be dominated by liquids due to consumption demand from China, which PIPC stands at an advantage of being the hub for various types of liquid cargo,” he told StarBiz recently.
Versluis added that liquid demand was predicted to shift from Organisation for Economic Cooperation and Development (OECD) countries to Asia until 2030.
“China alone will contribute to 38% of the growth in global oil demand. The country is expected to consume 17.5 million barrels of oil per day by 2030, overtaking the United States in becoming the world’s largest oil consumer.
“As of now, the complete masterplan for the PIPC is yet to attain cabinet approval, but it is gaining traction via some of development by Petronas RM60 bil Refinery And Petrochemical Integrated Development (Rapid) project.
“Another significant development within the PIPC area is The RM5bil Pengerang Independent Deepwater Petroleum Terminal (PIDPT) is a joint-venture between Dialog Group of Malaysia, Royal Vopak of Netherlands and Johor State Secretary Incorporated (SSI),” he said.
According to Malaysia Petroleum Resources Corp, the PIPC is one big step in creating value to the downstream oil and gas value chain in Johor.
Located in Pengerang, it is one of the largest pieces of investments in Pengerang district and located on a single plot measuring about 8,100 hectares.
The project will house oil refineries, naphtha crackers, petrochemical plants as well as a liquefied natural gas (LNG) import terminal and a regasification plant.
As of January, PIDPT construction of Phase 1 of the project has already started and is scheduled for completion by first quarter of next year and phase 2 land reclamation is in progress.
The total storage capacity available at PIDPT is planned for five million cubic m by the year 2020.
As for Rapid, project site preparation is in progress and is expected to be commissioned by 2016. Rapid will have a 300,000 bbl per day refining capacity while additional petrochemical plants will generate value to petroleum products produced in Rapid.
In order to achieve 10 million cubic m of oil and gas storage by year 2020, two strategic locations had been identified in Johor to supplement existing domestic and foreign storage demands.
The first one is Tanjung Bin that will have three million cubic m of storage by end of this decade.
The world’s largest oil and gas trader, Vittol has partnered up with MISC Bhd to establish Asian Tank Terminal (ATT) Tanjung Bin (ATB).
ATB phase 1 has storage capacity of 890,000 meter cubes.
Tanjung Langsat has been identified as the second storage area and the location has been taken up by a joint venture of MISC, Dialog, and PUMA Energy (a subsidiary of Trafigura).
The current combined capacity in Tanjung Langsat is 780,000 cubic m and PUMA Energy has recently agreed to invest 10 acres of land in Tg Langsat for their new Bitumen project.
Tanjung Langsat will have a total of 2 million storage capacity by year 2017.
“In short, Pengerang is being planned to be one of the largest oil and gas hubs in the region and the world.
“And within the Singapore basin, we believe that Johor will eventually overtake Singapore in terms of tonnage throughput.
“The ports in Johor will emerge as leaders with liquid bulk being the mainstay in their cargo mix,” he said.
But currently, Versluis said Singapore was still leading in trade volume, followed by Malaysia and Indonesia.
“And within the basin, Malaysia and Singapore already have a developed port sector while Indonesia still lags behind,” he said.
Roland Berger Strategy Consultants, founded in 1967, is one of the world’s leading strategy consultancies with around 2,700 employees working in 51 offices in 36 countries worldwide.