Gas is a clean and efficient source of energy, supporting todays concerns.

It drives progress and growth for the betterment of living standards for all of us. The tagline: Powering Growth, encapsulates the relevance of Gas to the consumer, and also reflects the aspirations and the potential of the gas fraternity as represented by the Malaysian Gas Association (MGA), to meet challenges while promoting further the development of the gas industry in the region. The Powering Growth design is represented by the typographic G, to serve as the common icon to denote associative synergy in realising and harnessing the potential of the Gas industry. The arrow incorporating an uptrend movement, enhances MGAs optimistic drive to increase gas utilisation through research and developmental initiatives, while promoting its usage as the global energy source of choice.

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Natural Gas Worlds Cleanest Fuel

Natural gas, which is clean-burning, cost effective and abundant, has moved the world away from belching smokestacks towards a less polluted environment. Natural gas is projected to be the fastest growing component of world primary energy consumption. Consumption of natural gas worldwide is expected to increase by an average of 2.3 percent annually from 2002 to 2025, compared with projected annual growth rates of 1.9 percent for oil consumption and 2.0 percent for coal consumption. From 2002 to 2025, consumption of natural gas is projected to increase by almost 70 percent, from 92 trillion cubic feet to 156 trillion cubic feet and gas share of total energy consumption on a BTU basis is projected to grow from 23 percent to 25 percent. The electric power sector accounts for almost one-half of the total incremental growth in worldwide natural gas demand over the forecast period.
As of January 2005, proven world natural gas reserves were estimated at 6,040 trillion cubic feet. In general, world natural gas reserves have trended upward since the mid 1970s . Asia ranked third in terms of incremental gas demand growth from 2001-2025 and Asias gas market demand has been growing at 5 times the global growth from 1980-2003. One of the fastest growing regions, Asia is a world leader in LNG industry, home to the worlds largest LNG suppliers and consumers with the worlds largest LNG producer being Indonesia and the largest consumer being Japan. LNG consumption in the Asia Pacific region could double close to 150 mtpa by 2015. Both China and India being emerging new economies have strong potential demand for gas. They are the regions fastest growing energy consumers and they have already become LNG buyers.

Malaysian Natural Gas Chain

Malaysian gas activities span the entire natural gas chain. This includes gas processing plants, liquefaction plants, pipeline, transmission, marketing and trading of LNG, gas district cooling, Natural Gas Vehicle (NGV) and supply of industrial utilities. It began with Malaysias first ever oil well, struck on 22 December 1910 in Miri, Sarawak. In 1965, natural gas began to be supplied to households and local industries in Miri, Sarawak, with associated gas from the West Lutong oil field. Today, Malaysia is the worlds largest LNG producer from a single location, the worlds largest owner of LNG production capacity and has interests in more than 10,000km of natural gas pipelines worldwide.

Malaysia exports 23 million tonnes per annum of gas in the form of LNG to traditional markets like Japan, Korea and Taiwan, as well as to the US and Europe. Malaysia supplies 49 per cent of Taiwans LNG needs, 25 per cent of Japans requirements and 21 per cent of that of South Korea. Globally, the country meets a whopping 21 per cent of total LNG needs. The LNG Malaysia supplies to the world is processed from feed gas from Central Luconia offshore Sarawak and liquefied at subfreezing temperature at the three plants owned by Malaysia LNG Sdn Bhd (MLNG), Malaysia LNG Dua Sdn Bhd (MLNG Dua) and Malaysia LNG Tiga Sdn Bhd (MLNG Tiga) respectively in the PETRONAS LNG Complex in Bintulu, Sarawak. In 2004, the Egyptian LNG project which came on stream six months ahead of schedule signifies Malaysias first LNG production plant outside the country. Malaysian gas fields also feed a domestic natural gas transmission pipeline system with over two billion cubic feet per day of processed gas, geared for power and industrial use. A major milestone in the development of the local gas industry was the establishment of the Peninsular Gas Utilisation (PGU) network in 1984. PETRONAS embarked on this project to be able to process gas from the fields off the State of Terengganu in the eastern part of Peninsular Malaysia and transport it through a network of pipelines to various parts of the country. Today, a total of 2,550km of main and lateral pipelines have been built, traversing the length and breadth of the country while extending the pipeline to Singapore in the south and Thailand to the north. There are six gas processing plants in operation with a gas production total sale capacity of 2,750 mmscf/d, inclusive of standby capacity, in addition to producing by-products such as ethane, propane, butane and condensate. The PGU project has made

a significant commercial impact on gas utilization in Peninsular Malaysia, with the production volume growing steadily from less than 50 mmscf/d in 1984 to over 2,000 mmscf/d in 2005. In 2004, there was an approximate 4.4% increase in gas supplied by the PGU system on the back of higher demand from the power sector. Processed gas is channeled towards the domestic power sector, which consumes up to 69 per cent of the total, non-power sector (25 percent) and is also exported to Singapore (6 percent).Complementing the PGU network, Gas Malaysia Sdn. Bhd. (GMSB), incorporated in May 1992, undertakes to distribute natural gas to end users. GMSB develops, implements and operates pipelines connecting PETRONAS city-gate stations to end users in the 4/5

Malaysian Natural Gas Chain

(continued)

commercial and industrial sectors, as well as homes. Currently, GMSB has more than 800 kilometers of pipelines in Peninsular Malaysia transporting an average of 90 mmscf/d of gas sold to industrial, commercial and residential customers. Although oil remains the most important fuel in the economy, the use of natural gas is rapidly expanding as there is a great desire for clean energy and better fuel alternative that will allow nature to co-exist alongside human enterprise. Being a clean primary energy source, and to prevent depletion of the countrys oil reserves, the Malaysian Government has since the early 1980s promoted greater use of natural gas. Regulations such as the National Depletion Policy, 1980; the Four-Fuel Diversification Strategy, 1981; and the Five-Fuel Diversification Policy, 1999, all aim to reduce the countrys reliance on oil while promoting other sources of energy, including natural gas. The increase in utilisation of natural gas has been marked in power generation. From making up only 22 percent of the generation mix in

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1990, natural gas constitutes about 65 percent to 70 percent of this mix today, and is planned to remain in the power generation mix in the future at between 50-60 percent. Despite an emphasis on coal in power generation, overall gas utilization in Malaysia is expected to increase at 4 percent per annum until 2020, on the back of a growing economy and increased use in the nonpower sector. In the State of Sabah, East Malaysia, the biggest consumer of natural gas is the methanol plant in Labuan. Another major user is the hot briquette iron plant, which is also in the free trade zone of Labuan. Natural gas is also being channeled towards independent power producers. Overseas, the Trans Thailand-Malaysia (TTM) has successfully commissioned the pipeline carrying

the Joint Development Area gas into the existing PGU system at Changlun, in the State of Perlis, which supplies customers in the northern region of Peninsular Malaysia. The TTM pipeline is the latest addition to the growing interconnection of cross-border gas infrastructure in ASEAN and charts another important step towards the realisation of the Trans-ASEAN Gas Pipeline (TAGP) network. Besides meeting the domestic demand, gas has also been exported to Singapore since 1992. Basic engineering design was also internally conducted and completed for the second Singapore Pipeline Project, which is scheduled to be completed by mid 2006. A milestone was created in 2004 when PETRONAS signed a Gas Sales Agreement with British Gas Trading Ltd. for the supply of natural gas in the form of LNG to the UK beginning 2008.

Natural Gas Supports

Malaysias National Development

The energy sector is considered the life provider of a nation. Natural gas is an important component of Malaysias fuel diversification policy to support national development. This will ensure that the natural gas sector will continue to progress well in the near and far future.

8/9 A lot of measures and initiatives are being undertaken in order to ensure sustainability of Malaysias natural gas supply through continuous and relentless efforts to develop and commercialise the natural gas reserves of the nation. Future utilisation of gas as feedstock will see the small and medium scale industries (SMI) such as ceramic, glassware, pulp, textile, rubber and steel fabricators, as having strong potential since natural gas would provide an ideal fuel alternative for combustion, heating, in chemical and metallurgical industrial manufacturing processes. The co-generation market is another significant segment where potential markets are seen. In the residential and commercial sector, unit electricity consumption will continue to increase in the period 1999 to 2020 due to an increase in per capita GDP growth coupled with growing urbanization and rising average incomes. In moving forward, Malaysia and PETRONAS will continue to strengthen its position as an integrated gas player in ASEAN, expand its global LNG portfolio by capturing markets in the fast growing Atlantic Basin and capture more value out of Malaysias gas chain. With the ongoing efforts in the country and abroad, Malaysia is poised to play a significant role in the global gas industry.

Establishment of the

Malaysian Gas Association (MGA)

Anticipating the important role that natural gas is set to play in the Malaysian energy scene, PETRONAS took the initiative to interest some key players in the Malaysian gas industry to form the Malaysian Gas Association, which was duly registered on 21 July 1986, as Persatuan Gas Malaysia.
10/11 The MGA is a Non-Profit organisation and offers the following categories of membership: a) Full Corporate Members Open only to incorporated companies engaged in the commercial production, separation, treatment, bulk distribution or wholesale of gas. b) Ordinary Corporate Members Open to any company or organisation, whether incorporated or unincorporated, interested in the advancement of the gas industry in Malaysia. c) Ordinary Members Open to any individual interested in the advancement of the gas industry in Malaysia. Currently open to employee(s) of Corporate members. d) Honorary Members Institutions or individuals that the Council may from time to time recognise as having contributed significantly to the objectives of the Association.

Objectives To provide a forum in which members of the Association can discuss matters relating to gas (exploration, production, separation, gathering, transmission, liquefaction, distribution, storage and utilization). To serve as the focal point and channel of communication with the Government on matters of concern and interest to the industry including formulation and recommendations on policies, regulations, safety, investment incentives and related matters. To advance knowledge, learning, and stimulate research in the area of gas technology. To promote uniformity and safety of practices and standards relating to the industries. To collect, analyse and disseminate via periodic publications, information on gas industry activities. To stimulate the development of the gas industry in Malaysia. To enhance understanding of the general public about the role of gas as clean and efficient energy to the nation. To promote friendship and cooperation among organisations and professionals involved in gas related activities. To actively participate in worldwide gas activities under the auspices of the International Gas Union (IGU) with a view to advance knowledge and research in the gas industry.

MGA International Affiliation

MGA is a member of the International Gas Union (IGU) which is recognised as the principal worldwide forum of the gas industry. Founded in 1930 with the objective to study all aspects of the gas industry and to advance its progress from both technical and economic aspects, the IGU: cultivates fraternal relations amongst its members, organises conferences, and encourages the exchange of information between its members and also between IGU and other international organisations concerned with energy. The MGA is a window through which Malaysians can gain access to the world of gas, principally by participating in the activities organised by IGU. The MGA is also a member of GASEX (Gas Information Exchange in Western Pacific Area) along with fourteen other countries. The aim of GASEX is to strengthen information exchange in order to develop the gas industry in the area and seek solutions to issues facing member countries. Major activities of GASEX include organising of biennial conferences and exhibitions. One of the significant achievements of the MGA thus far is hosting the tenth LNG International Conference and Exhibition in 1992, in Kuala Lumpur, Malaysia. This premier event on LNG attracted some 4000 participants including delegates, exhibitors and visitors to the exhibition. MGA also hosted the GASEX 96 Conference and the NGV 96 Conference and Exhibition in 1996.

MGA Activities
To achieve MGAs objectives, the following activities may be undertaken. Organising these activities successfully will require the full support of all members. 12/13

Coordinate and liaise with relevant Government departments and regulatory agencies to discuss and resolve issues pertaining to the gas industry. Participate actively in the formulation, drafting of and review of regulations, standards and best practices in the industry. Publish monthly/quarterly newsletter to members/target groups on gas activities/development in Malaysia and the rest of the world. Conduct Seminars and Conferences with the aim of providing knowledge on the gas industry and technology. Launch Publicity Campaigns to encourage and promote the use of gas and gas operated/fired appliances. Hold Technical Lectures to disseminate information on the gas industry. Organise and sponsor conferences related to gas industry in conjunction with institutions of higher learning. Establish a library and to maintain gas proceedings, safety standards, etc. Organise social functions to enable MGA members to meet informally and promote goodwill. Actively involve as Guest Speaker and present papers in Gas Conferences. Establish an MGA Prize Award, through donations, for the benefit of researchers or persons associated with the gas industry to encourage the study on gas related technologies in Malaysia.

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Malaysian Gas Supply Act,

Consistent with its policy to promote wider use of natural gas, the Government on 4 February 1993, gazetted the Gas Supply Act 1993 pertaining to gas reticulation to the industrial, commercial and residential sectors.

Regulations and Safety

The Act provides for the appointment and functions of a Director General of Gas Supply, the licensing of suppliers of gas to consumers and regulations with respect to safety of operation and the commercial aspects in gas pricing. The Government has implemented the Gas Supply Regulations in 1997, which will be enforced together with the Gas Supply Act 1993. The regulations encompass among licensing and registration of the installation, inspection and registration of contractors, competent persons, manufacturers and importers of gas equipment, investigation and prosecution, and code of ethics to ensure safety in the gas industry. With regards to the safety aspects of the gas industry, the Petroleum Safety Measures Act was gazetted and enforced in 1984. The Act provides for regulatory requirements for safe operations involving the handling, storage and transportation of petroleum through pipelines by road, rail, sea or air. To date, the Malaysian Gas Industry has achieved significant milestones with respect to safety in its operations and its accomplishments have been bestowed with several national and international safety awards.

Kindly submit your application by completing either: a) PGM FORM I for admission as FULL/ORDINARY CORPORATE MEMBER, or b) PGM FORM II for admission as ORDINARY MEMBER. (Currently open to employee of Full/Ordinary Corporate Members) Send the duly completed form together with the annual fee by way of a crossed cheque or bank draft payable to Malaysian Gas Association. The fees are as follows: RM5,000 Full Corporate Member RM1,000 Ordinary Corporate Member RM50 Ordinary Member

(5 nominees) (5 nominees) (individual)

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How to Become a Member

All payments and correspondence to be sent to:

SECRETARIAT MALAYSIAN GAS ASSOCIATION LEVEL 54, TOWER 1 PETRONAS TWIN TOWERS KUALA LUMPUR CITY CENTRE 50088 KUALA LUMPUR MALAYSIA EXECUTIVE SECRETARY MR. ZENORAI RAMBLI TEL : +(6)03-2331 3181 FAX : +(6)03-2331 2888 / 1345 E-mail : [email protected] ASSISTANT TO EXECUTIVE SECRETARY MS. JEANNIE LEE TEL : +(6)03-2331 4687 FAX : +(6)03-2331 2888 / 1345 E-mail : [email protected] http//:www.malaysiangas.com.my

Design: Johan Design Associates, Malaysia.