Thailand’s PTTEP buys 10% stake in Petronas’ Bintulu LNG complex

Malaysian state-owned oil and gas company Petroliam Nasional Bhd (Petronas) has sold a 10% stake in Petronas LNG 9 Sdn Bhd (PL9SB) located in Malaysia to its partner, Thailand’s PTT Exploration and Production Public Company Ltd (PTTEP), for US$500million (RM2.14billion).

PL9SB owns the ninth liquefied natural gas (LNG) liquefaction train and other related associated facilities located in the Petronas LNG complex in Bintulu, Sarawak, with a production capacity of 3.6 million tons per annum of LNG. Its commercial operations started on January 1, 2017.

“The acquisition of the equity interest in PL9SB is part of PTTEP’s strategy to synergize with PTT in the integrated LNG value chain to meet the country’s growing energy demand,” PTTEP said.

The stake was acquired by PTTGL Investment Ltd (PTTGLI) – a company set up by PTTEP’s subsidiary PTT Global LNG Company Ltd (PTTGL). PTTGL is a subsidiary of PTTEP, which is a 50:50 JV between PTTEP and PTT plc.

PTTEP said that PTTGLI had signed the share sale and purchase agreement with Petronas to acquire the 10% equity stake in PL9SB.

“The total consideration of the acquisition is approximately US$500million of which PTTEP’s portion is approximately US$250million,” it said. The expected closing date of the transaction is within September this year.

“With the entrance of PTTGLI, the share proportion in PL9SB shall stand at 80%, 10% and 10% owned respectively by Petronas, JXTG Nippon Oil & Energy Corp (through its subsidiary, Nippon Oil Finance (Netherlands) B.V.) and PTTGLI,” it added.

PTTEP said the US$500million acquisition cost would be funded by 40:60 debt and equity.

Meanwhile, Petronas’ subsidiary PC Vietnam Ltd (PCVL) will hand over Blocks 01 and 02, located at the Cuu Long basin in offshore Vietnam, to the host authority once the production sharing contract (PSC) for the blocks expires on September 9, 2017.

Petronas said in a statement that the 26-year PSC for the blocks took effect on Sept 9, 1991, and was Petronas’ first successful international venture.

Following the natural expiry of the PSC, PCVL will cease its operations as stipulated by the contract terms, it said.

“We have come a long way since our entry into Vietnam in 1991, which was an important first step at the beginning of our globalisation journey,” Petronas president and group chief executive officer Datuk Wan Zulkiflee Wan Ariffin said in the statement.