Cheaper, cleaner gas for SMEs launched

KOTA KINABALU: Sabah Energy Corporation Sdn Bhd (SEC) has embarked on a new technology to supply compressed natural gas via a virtual pipeline system.

SEC Chief Executive Officer Datuk Harun Ismail said the RM13.3 million virtual pipeline system is an economical approach to make natural gas, which is a cheaper and environmentally friendlier fuel, to a broader spectrum of customers whose premises are located at distances as far away as 70km from SEC’s existing premises at Kota Kinabalu Industrial Park.

The launch of the virtual pipeline system by Chief Minister Datuk Seri Musa Aman yesterday made Sabah the first state in the country to offer compressed natural gas at a price that is up to 50 per cent lower than that of alternative fuels.

With the system, capital intensive underground pipelines that are traditionally used for gas distribution can be avoided and the reach of customers can be extended, Harun told reporters during the launching ceremony yesterday.

He said that so far, the response to the system has been very good and SEC expects to have another two to three companies coming on board soon.

“This system is recommended to SMEs which has boilers and factories and uses high level of burning fuel,” Harun said.

Asked if the system could be extended farther than the 70km radius, Harun said they have to set a limit because of the logistical constraints, such as the road system.

“This is a virtual pipeline, we need to supply continuously as if there is a pipeline there, so if we go beyond 70km, we would not be able to meet the requirement unless the road system is improved,” he explained.

According to Harun, the technology provider of the virtual pipeline system is GNC Galileo of Argentina, where the system has been used for over 20 years, while similar systems are being used in other parts of South America.

GNC Galileo will be working with its Malaysian agent Frugas Synergy Sdn Bhd and SEC in providing continuous technical back-up for the system, he said.

SEC has a complete team of trained and competent engineers as well as technicians to not only operate the system but also assist customers in their studies to convert their existing equipment to use natural gas.

“It does not cost much to convert the equipment but in the long run, the savings will be higher,” he said.

Commenting on Musa’s hope that SEC will expand this system to the east and south of Sabah, Harun said the gas that will be landing in Lahad Datu is LNG, not natural gas.

“We might be using a different kind of technology, not CNG because in Lahad Datu, the gas landed will be in the form of LNG, so therefore we need to go in a different mode of system. But this is too early to discuss.

“We are working with our partner and once the LNG landed in Lahad Datu, we probably would be able to cover the district, Tawau and Sandakan,” he said.

Meanwhile, the Chief Minister said he would like to see sectors that use highly polluting fuels to seriously consider switching to natural gas.

“By doing so, we can all enjoy a cleaner environment,” Musa said.

He pointed out that natural gas is a cleaner burning fuel compared to other types of fossil fuel, so using natural gas would therefore translate into less pollution.

“This is very important when viewed from the context of the State Government’s focus towards ensuring that its growth sectors practise initiatives that stress on environmental protection and sustainability, he said.

“Such a move also fits in with our focus on promoting Sabah as an eco-tourism destination,” he said.

On the project, Musa said he was happy to note that SEC has taken the initiative to introduce the technology in Malaysia.

“Apart from the fact that our state will be the first in Malaysia to adopt this approach, I take note that natural gas, a resource that is so vital to us here in Sabah, can be brought to a wider spectrum of users,” he said.

Also present at the launch were Deputy Chief Minister and Minister of Resource Development and Information Technology Datuk Dr Yee Moh Chai and Sabah Energy Corporation Chairman Au Kam Wah.

Source: http://www.sabahtoday.com/?p=9260