RM8.5BIL NEW OIL & GAS STORAGE FACILITY IN SIPITANG SABAH TO BE UNDERTAKEN BY HALIM SAAD’S ARMADA

RM8.5bil new O&G storage facility to be undertaken by Halim Saad’s Armada

PETALING JAYA 2/10/2012: A new facility for oil and gas (O&G) storage and refining to be known as Sabah Oil Terminal, is being planned in Sipitang, Sabah at an estimated cost of RM8.5bil, sources said.

The sources said that a 1,000-acre site at the Sipitang Oil and Gas Industrial Park has been allocated for this development which would be undertaken by Armada Sdn Bhd beginning next year.

Armada is a special purpose vehicle (SPV) set up by businessman Tan Sri Halim Saad and the SPV had received the green light from the Government, the sources added.

Halim had been working on the project and those in the know claimed that he had managed to convince some international oil and gas companies to use the facilites for storage and refining of crude oil to be exported within the Asian region.

Halim could not be reached for comments.

The Sipitang O&G project, the sources said, would be developed over two phases,

• the first costing RM4.7bil would cover storage, supporting infrastructure facilities, housing and mixed development.
• The second would involve the development of a refinery and other support facilities at an estimated cost of RM3.8bil. The entire project would be developed over a four to five years .

The sources could not give any details on the funding for the project.

The entire complex would be used to cater for storage of crude oil and petroleum products, blending and refinery facilities. Phase 0ne would cover the development of storage facilities to cater up to 1.5 million cu m of crude oil and 50,000 barrels of crude oil for refinery, supporting infrastructure facilities, housing and mixed development.

In his budget speech, the Prime Minister had said that this year, some US$20bil (RM61.13bil) worth of oil and gas projects had been implemented.

Among the notable ones are Petronas's Refinery and Petrochemical Integrated Development oil and gas storage terminal in Johor, the regasification plant in Malacca and the oil and gas terminal in Sipitang, Sabah.

The new project in Sabah may not be just an oil storage facility but it could potentially be a petroleum reserve centre. The United States, China, Russia, Thailand, Singapore and Japan have such centres to keep supplies for between one and three months. Sources added that it was likely that the project management works for phase one would go to Halim's corporate vehicle Seloga Holdings Bhd.

By B.K. SIDHU