Kuala Lumpur, 04 May 2021 – Tailored to provide a rare platform to policymakers and players in the Third Party Access (TPA) market to jointly deep dive into the progress of the gas market liberalisation, Malaysian Gas Association (MGA) today organised a virtual Roundtable Dialogue with the theme “Opportunities and Challenges in the Third Party Access market”.  The natural gas market that was previously restricted to incumbent suppliers was eventually opened to third party gas suppliers, called Shippers, ever since the Gas Supply (Amendment) Act 2016 came into force in January 2017. Since then, the market has seen only a handful of Shippers that are actively supplying gas through the pipeline infrastructure.

The Roundtable that has successfully convened all the parties directly involved in the TPA market, from policymakers to TPA players, kicked off with a keynote speech delivered by Zaeidah Mohamad Esa, Director of Energy from Economic Planning Unit (EPU) who provided policy updates and progress of the gas market liberalisation in Peninsular Malaysia. This is followed by presentations on regulatory and infrastructure readiness by Energy Commission (ST) as regulator and PETRONAS Gas Berhad as infrastructure operator respectively. They were later joined by several active Shippers, including PETRONAS, Shell, Gas Malaysia, Petrolife Aero and Federation of Malaysian Manufacturers, representing the consumers, in the ensuing Roundtable Dialogue moderated by Zahid Osman, a Council Member of MGA.

In his opening remarks Hazli Sham Kassim, President of MGA, highlighted the importance of all parties to jointly deliberate on how to make the TPA market more vibrant and attractive to all Shippers. “TPA is a fundamental building block of the gas market liberalisation. An attractive TPA will ensure success of the gas market liberalisation, leading towards a vibrant and sustainable gas industry, an industry that have been driving the nation’s economic growth and offering employment throughout its value chain”. As the nation’s lead advocate for the Malaysian gas industry, MGA represents more than 130 corporate members that serve the entire gas value chain from upstream to downstream.

The Roundtable took place at the right time as the gas market is expected to be fully liberalised by 2022 — when the remaining regulated gas tariff ends on 31 December 2021.  A trial cargo successfully brought in by Shell in October 2019 proved that the system, both regulatory- and infrastructure-wise, was ready to accept access by third parties.  To date, a total of 17 LNG importers and 12 Shippers have been granted licenses by Energy Commission to participate in the TPA. Several other Shippers also attended the Roundtable as observers. “We are pleased to witness the energetic and passionate dialogue at Roundtable, demonstrating that all parties involved are singular in their interest to ensure the success of the Third Party Access. We hope that the suggestions and recommendations raised during the dialogue will be considered and adopted by the concerned parties. We look forward to more importers and Shippers to participate in the TPA market; trading on willing buyer-willing seller basis and on a level playing field, thus providing competitive options to consumers”, commented Hazli Sham after successful conclusion of the Roundtable.

Full gas market liberalisation sets the path towards a vibrant and sustainable natural gas industry. The nation has benefited and will continue to benefit from natural gas as an important source of energy, enhancing our energy security and reliability. A vibrant market will encourage greater utilisation of gas, thereby stimulating more business opportunities and investments throughout the gas industry value chain, where LNG imports complements the indigenous gas supply. Sustained production of indigenous gas is critical in maintaining integrity of the gas supply network, ensuring security of supply and supplying to industries that requires richer gas components. The entire gas industry have been playing a major role in Malaysia’s socio-economic growth, bringing over RM 135 billion per annum of economic impact and creates over 80,000 jobs in the wider economy.

As the cleanest burning fuel, natural gas plays an important role in providing clean, secure, reliable and flexible energy to drive Malaysia’s low carbon energy transition towards a sustainable future. On 24 March 2021, when commenting on the upcoming National Energy Policy, the Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed has reportedly indicated that oil & gas will remain the most important source of energy for the foreseeable future, with natural gas playing an even more critical role in facilitating energy transition.