Tenaga Nasional Bhd and Petronas Gas Bhd have agreed to jointly develop Malaysia’s third liquefied natural gas (LNG) regasification terminal (RGT-3) in Lumut, Perak, in a move that strengthens the country’s long-term energy security and supports future gas-fired power generation growth.
The collaboration was formalised through a heads of agreement signed on June 4, with both parties planning to establish a joint venture to develop and operate the project. The respective equity stakes in the venture have yet to be disclosed.
RGT-3 will be Malaysia’s first regasification terminal based on a Floating Storage and Regasification Unit (FSRU) concept. The facility will feature LNG storage capacity of 170,000 cubic metres and regasification capacity of 500 million standard cubic feet per day (mmscfd).
The terminal’s capacity is sufficient to support approximately 3.5 gigawatts (GW) of gas-fired power generation capacity.
According to CGS International, the FSRU will be leased from MISC Bhd under a 20-year firm contract, while construction will be undertaken by South Korea’s Samsung Heavy Industries.
TNB Fuel Services Sdn Bhd, a wholly-owned subsidiary of TNB, will underwrite the terminal’s capacity in stages, with full capacity commitments expected from 2030 onwards.
Analysts view the project as strategically important for TNB as it expands its role across Malaysia’s gas value chain and secures long-term fuel supply for its growing portfolio of combined cycle gas turbine (CCGT) power plants.
The utility group recently secured the 1.4GW Paka power plant project under the NEWGEN25 programme and is also pursuing the proposed 2.1GW Kapar gas-fired power plant.
With domestic natural gas production gradually declining, LNG imports are expected to become an increasingly important source of fuel supply for Peninsular Malaysia. The transition towards self-sourced fuel arrangements under the Malaysia Electricity Supply Industry 2.0 (MESI 2.0) framework has further increased the strategic value of LNG infrastructure ownership.
While the regasification business is expected to provide an additional earnings stream, analysts believe the more significant benefit lies in enhancing fuel security and supporting future expansion of TNB’s generation capacity.
CGS International maintained its “Add” rating on TNB with an unchanged target price of RM16.60, citing the company’s position as a key beneficiary of Malaysia’s accelerating energy demand growth and multi-year power sector investment cycle.
The research house noted that increasing electricity demand from data centres, new power plant developments and renewable energy projects remain potential catalysts for the utility’s long-term growth.
