Property Hunter Magazine Property Hunter Magazine Issue 52 - March 2014 | Page 65

Putrajaya Eyes Lucrative Sabah Port Petronas Pipes Gas to Sabah Terminal be given opportunities and priorities in any federal project. Speculations are rife here that experienced ports handlers from the peninsula with ‘direct connections’ to Putrajaya are aiming to take over operations of Sabah’s main west-coast port – Sepanggar Port, the last jewel in the state’s crown. Industry sources told FMT that the federal government is looking at the possibility of getting big handlers from Klang Port to expand to Sabah ostensibly for their experience, expertise and efficiency which will help raise the profile of Sepanggar Port internationally. The planned move is said to be related to the realisation in the peninsula that the cabotage policy is unsustainable after becoming a major sticking point in federal-state relations. “When the federal government does this, it ensures there already is strategic business alliances developed as ports’ business is a big business and the big players would always want that their interests protected once Sabah ports develop. “With the cabotage policy liberalised, this will mean Sabah ports like Sepanggar would become the next big hub for container ships and those with interests will not ignore such an opportunity,” said one source. The cabotage policy stipulates that foreign container ships need to call at Klang Port first ensuring that all goods bound for Sabah and Sarawak are off-loaded there and reloaded on to Malaysian vessels thus incurring an increase in handling charges and contributing to a hefty increase in the prices of goods in the two state. According to industry sources, negotiations could well be under way between all the stakeholders to find a way to ensure the interested parties do not suffer losses when the cabotage policy ends. “If things are on schedule, we shall see bigger allocations for Sabah ports especially Sepanggar Port in the subsequent federal budgets starting from next year,” the source said. The source added that it is “normal” for big players in peninsular with links to the federal leadership to Both sides are expected to announce their intentions to establish strategic port alliances to coincide with the announcement to abolish or further liberalise the unpopular cabotage policy. When this is announced it will see Sabah lose ‘control’ over yet another utility system. Already oil, air, road and electricity are with the federal government . Sepanggar Port became the main container port in the last decade after most sea traffic was directed away from the Kota Kinabalu Port, formerly known as Jesselton Harbour, which has now become the main anchorage for cruise ships and similar vessels. The relocation of container ships to Sepanggar in 2007 paved the way for the development of the old port area into a shopping and touristrelated business district. The Sepanggar Port project, on the other hand, opened up the area to the development of a container terminal, a naval base, an oil terminal, an industrial park and allowed institutes of higher learning such as Universiti Teknologi MARA (UiTM) and the Kota Kinabalu Polytechnic among others to build campuses there. Sabah Oil and Gas Terminal (SOGT) in Kimanis Petronas has begun piping natural gas into the RM3.8 billion Sabah Oil and Gas Terminal (SOGT) in Kimanis, marking an important milestone in the industry. With an initial flow of 65 million standard cubic feet per day (MMSCFD) from the Kinabalu Non-Associated Gas field southwest of the state via a 120km underwater pipeline since Monday, it was part of the commissioning process for the terminal. The commissioning process will put to test and ensure the systems and components at the terminal are running according to specifications and requirements before it starts commercial operations. Once fully operational, the SOGT, located 65km from here, will have the capacity of 260,000 barrels per day (bpd) of oil and 1,250 mmscfd of natural gas, said a statement from Petronas Sabah and Labuan Regional office. It is the biggest integrated terminal in the country with the ability to receive, handle and export oil and gas produced offshore. It will position the state as an onshore oil and gas hub in the region, complementing the operations of the existing Sabah Gas Terminal, the Labuan Crude Oil Terminal and the Labuan Gas Terminal. Sabah branch Malaysian Malay Chamber of Commerce chairman Datuk Ag Buhtamam Ag Mahmun yesterday said the move was a positive development for the country. “The SOGT and other key oil and gas projects in the state are part of the national agenda to bring more progress. “To see it up an @