KOTA KINABALU: The Sabah Oil and Gas Development Corporation (SOGDC) has signed two sub-lease agreements and eight memorandums of understanding (MoUs) with a total investment value of RM19.8 billion.
Sabah Deputy Chief Minister Datuk Dr Joachim Gunsalam said the agreements were signed with investor companies on March 24 and 29.
The investor companies wanted to develop oil and gas-related businesses in the Sipitang Oil and Gas Industrial Park (SOGIP) such as solid waste management, oil refinery, oil tank, silicon metal plant, power plant, green diesel plant, regasification facility and hydrogen-ammonia plant, said Joachim, who is also the state industrial development minister.
He was replying to Datuk Dr Yusof Yacob (Independent-Sindumin), who asked about the status of the investments three months after the agreements were signed, at the State Legislative Assembly sitting today.
He said SOGDC continued to hold discussions with the investor companies to ensure they could take the next step.
The "Strategic Engagement Forum with SOGIP Investors and Service Providers" on June 8 was among the efforts carried out, he said.
"Through this forum, my ministry is confident that they can carry out their respective businesses according to schedule," said Joachim.
He said the investor companies were given five months to pay the lease rental deposit.
According to the discussions between SOGDC and the investor companies, the deposit would be paid no later than August, he added.
According to the agreement, the lease rent will be paid in stages and full payment will be made in 2047, which is five years before the lease term for 30 years expires in 2052.
The lease period was renewable by mutual agreement, subject to new terms and conditions including the lease rental rate, he added.
He said the investors had ensured that all approvals required to develop their businesses such as development plan, building plan, environmental impact assessment report and others could be obtained within 12 months from the date of the agreement.
Next, he said the investors must complete all infrastructure, buildings and plants within 36 to 60 months to start their businesses.
As for the MoUs, all investor companies will continue to discuss with SOGDC on the terms and conditions to be included in the next agreements, which must be signed within 12 months.
These subsequent agreements were for the lease, partnership and shareholders, he added.
He said investors from within and outside the country could play an important role to help strengthen Sabah's economy while providing employment to the locals.
He added the state government continued to attract investors by providing a business-friendly environment and skilled workers.