SPG to chart O&G downstream road map

7/3/2016

MIRI: The state government is charting a new direction for the oil and gas industry through the gathering of the best brains under a non-profit group Suarah Petroleum Group (SPG).

The new think-tank — set up at the behest of Second Resource Planning and Environment Minister Datuk Amar Awang Tengah Ali Hasan last year —gathers engineers, lawyers, consultants, entrepreneurs, contractors and service providers in the oil and gas industry. It is regarded as an ‘invaluable body of knowledge and experience’ that the state government could tap into.

“The formation of SPG is timely and appropriate in helping the state government to chart a roadmap for the benefit of our future generation,” the minister said in officiating at the first annual general meeting (AGM) and launch of SPG here on Saturday.

According to Awang Tengah — who is also Industrial Development Minister — the state is currently facing the impact from depressed global oil prices, such as reduced earnings as well as a decline in economic and employment opportunities.

He also highlighted the need to dispel the notion that Sarawak’s interest in developing its oil and gas industry was ‘distinct and separate from national interest’.

“I support the view of SPG that the economically-viable industrial development must be aligned to national interest. The rich oil and gas resources in Sarawak need to be exploited more equitably over the long-term so as to generate more economic multipliers for the state, as opposed to a predominantly ‘extract-and-sell’ strategy that has been implemented in the past.

“The primary ‘commodity approach’ is also not sustainable in the long-term and would weaken the national oil and gas industry.”

He also said despite the establishment of Asean Bintulu Fertiliser (ABF), there was still much room for downstream activities, as most of the oil and gas commodities were still exported in their raw forms.

Adding on, he said the recent approval for the setup of South Korea’s Huchems fine chemicals production plant in Bintulu indicated the state government’s seriousness in boosting downstream value-adding activities in the division.

“Bintulu has the necessary infrastructure, so we should look forward to developing it into becoming the petrochemical hub for this region,” he said.

Awang Tengah added that as part of the aim towards greater participation in the industry — both upstream and downstream — through more business opportunities, his ministry had set up Sarawak Oil and Gas Committee (SOGC) and Sarawak Oil and Gas Development Unit (SOGDU).

“Both entities would play the roles of advising, coordinating, monitoring and formulating policies to promote Sarawak’s interest and participation in industry development, as spelt out by Chief Minister Datuk Patinggi Tan Sri Adenan Satem who stressed that Sarawakians should not be happy just being ‘bystanders’ in such development.”

Meanwhile, Awang Tengah later announced the appointment of SPG pro tem president Hamim Yusuf and his deputy president Jamel Ibrahim as alternate members representing SPG in SOGC.

Earlier Hamim thanked Awang Tengah for his unwavering support for SPG since the very beginning, adding that the group was focused on helping the government on the negotiation for higher oil and gas royalties for the state, addressing the impact of low oil prices and ensuring holistic development of the industry.

The event was also attended by Assistant Minister of Industrial Development (Investment and Promotion) Datuk Julaihi Narawi.