KUALA LUMPUR: Petronas Gas Bhd (PetGas) has entered into five head of agreements (HoAs) to pursue the expansion of industrial gas facility and supply of nitrogen with the subsidiaries of Petronas Chemicals Group Bhd (PetChem).
The project will provide additional nitrogen to serve new demand within Kertih and guaranteed back up supply for the customers, the company said in a filing to Bursa Malaysia today.
The subsidiaries involved are Petronas Chemicals Ethylene Sdn Bhd, Petronas Chemicals Ammonia Sdn Bhd, Petronas Chemicals Aromatics Sdn Bhd, Petronas Chemicals LDPE Sdn Bhd and Petronas Chemicals Olefins Sdn Bhd, Petronas Chemicals Glycols Sdn Bhd and Petronas Chemicals Derivatives Sdn Bhd.
PetGas in the filing said the project includes the construction and installation of a new nitrogen facility, upgrading the existing nitrogen facility, enhancing the current back-up facility and operation and maintenance of the nitrogen supple.
The project's commercial operation is expected to be commenced by February 2021.
The HoAs signify understanding and commitment between PetGas and the respective customers of the project for PetGas’ further action in ensuring the successful delivery of the project, the filing noted.
The HoAs has been entered to formalise the commitment of customers to pursue the supply of nitrogen through execution of the project as per agreed terms and conditions outlined in the HoAs, it said.
PetGas will fund the project through its internally generated funds.