3^rd October 2019, Kuala Lumpur – As lead advocate for the nation’s natural gas industry, Malaysian Gas Association (MGA) welcomes the agreement between Tenaga Nasional Berhad (TNB) and Shell Malaysia Trading Sdn Bhd (SMTSB) for a trial third party cargo – the first since the Third Party Access (TPA) came into force. The planned delivery of this first TPA LNG cargo next week will mark an important milestone in the gas market reforms that started in 2013, with the first regasification terminal began operating in Sungai Udang, Melaka, enabling LNG importation.

The Gas Supply (Amendment) Act 2016, already in operation since Jan 2017, allows third parties to sell gas, thus offer options to gas users, which works in the best interests of the consumers. It provides them with an array of choices in sourcing for the right supply option by making it possible for gas suppliers to mix and match service offerings so that they meet the exact requirements of the consumers.

This maiden third party LNG importation, and supply of gas, is an important and significant milestone for gas price liberalization. It proves that with the right pricing signal from the domestic market, third parties can enter to offer competitive sourcing options and validates the policy of staying the course on gas market liberalization.

But for more third party cargoes to come in, more needs to be done to increase the consumption of gas in the country. These include attracting new investors that consume gas, increasing the uptake of existing consumers, enhancing accessibility to the clean fuel and promoting a higher percentage of gas in the power generation mix.

Gas promotes the nation’s socio-economic progress by having a high economic multiplier effect, enhances energy security by virtue of its abundance and availability and spurs the growth of the low carbon economy for a sustainable future. In this regard, ensuring a sustainable gas industry through increased gas utilization will ultimately benefit the nation.

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