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Infrastructure & PPPs in Malaysia - Q4 2022 Update

YOG INFRA Q4 2022 insight series

MALAYSIA is marked by infrastructure developments at local/ state levels of the country (e.g. Sarawak, Sabah) through localized infrastructure planning well-suited to meet local needs and have a strong on-ground impact. These developments across rooftop solar, floating solar, biomass, battery storage etc. are being done by local investors & developers in the country.

Read the key developments in Infrastructure and PPPs in Malaysia in our latest insight series.

 

October 2022

PETRONAS SIGNS PRODUCTION SHARING CONTRACT WITH TOTALENERGIES AND SHELL

Malaysian state-run company Petronas has signed a production sharing contract (PSC) with TotalEnergies EP Malaysia (TE),and Petronas Carigali (PCSB) for an ultra-deep water block located off the coast of Sabah. The PSCs have been signed via the Sabah Shell Petroleum Company (SSPC) and Shell Sabah Selatan (SSS).

TE, a wholly owned subsidiary of France-based TotalEnergies, will be the operator with a 34.9% participating interest. PCSB holds a 40% participating interest, while the remaining 25.1% is equally split between the other two partners, SSPC and SSS.

The contract covers Block 2K, with a depth of up to 3,000 metres covering 1,952 sq.km, is located in the north-west ultra-Deepwater area within a proven hydrocarbon basin with promising hydrocarbon potential. A total of four wells are expected to be drilled in these ultra-deepwater blocks in 2022 and 2023.


CHINA THREE GORGES EVALUATES RENEWABLES INVESTMENTS IN MALAYSIA

China Three Gorges is considering opportunities to develop solar and other renewable power projects in Malaysia. The company's assessment of the market is in its early stages, it is looking at potential projects that can integrate solar, hydro, coal-fired power and battery storage facilities.

The state-owned hydropower major has prior experience in Malaysia, having served as a contractor for a 944 MW project in 2014 in Sarawak state.


SINGAPORE-MALAYSIA ELECTRICITY INTER-CONNECTOR UPGRADED; CAPACITY DOUBLED

The Energy Market Authority (EMA) has announced that the electricity interconnector between Singapore and Malaysia has been upgraded, in a move to improve energy connectivity between the two countries. After the upgrade, capacity of the interconnector has been doubled and can now accommodate around 1,000 MW of bidirectional electricity flow.

The electricity inter-connector is used for the cross-border power trade in the Laos -Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP). As a part of the project, Singapore imports upto 100 MW of hydropower from Laos through interconnections in Thailand and Malaysia.


TNB SECURES FINANCING FOR ITS LARGE-SCALE SOLAR PROJECT IN KEDAH

TNB Bukit Selambau Solar Dua Sdn Bhd (TBSS2), a special purpose vehicle company of Tenaga Nasional Bhd (TNB), has secured a RM 185 Mn loan to finance its large scale solar mentari (LSS4) project in Kedah, Malaysia. The 50 MW solar facility will be located on an area covering 70 hectares and is scheduled to commence commercial operations in December 2023. This is TNB’s third large scale solar project in Bukit Selambau. In August 2021, TBSS2 signed a 21-year power purchase agreement (PPA) for the development of the solar facility.


JV SECURES RM 1.3 Bn CONTRACT TO INSTALL FIBRE OPTICS IN MALAYSIA

The Ministry of Communications and Multimedia (K-KOM) has awarded Privasia Technology Bhd and Apex Communications Sdn Bhd two contracts with a combined value of RM 1.2 Bn to install and maintain fibre optics cables in the northern and southern regions of Malaysia.

Work in the southern region, including Negeri Sembilan, Melaka and Johor is expected to cost RM 627.2 Mn while in the northern region including Kedah and Perak will cost RM 617.5 Mn. Contract will be valid for 8 years, out of which the implementation period is 3 years followed by a 5-year warranty period.

Fibre-optic infrastructure will be developed in schools, residential, business, commercial and industrial premises under Phase 2 of the expansion of broadband infrastructure using the point of presence (POP) method.


November 2022

MALAYSIA'S KAB SIGNS 20-YEAR SOLAR PPAS WITH NEXTGREEN

Malaysian engineering and energy solutions provider Kejuruteraan Asastera (KAB) has signed 20-year solar power purchase agreements (PPA) with a subsidiary of Nextgreen Global. KAB's subsidiary KAB Core Connect O&M Services reached two PPAs with Nextgreen Pulp and Paper to design, construct, install, own, operate and maintain solar systems with a total combined capacity of 3,387 kWp on the rooftops of multiple production plants and buildings at Nextgreen's Green Technology Park in Pekan, Pahang.

Nextgreen, which is a Malaysian investment holding company, will also purchase the solar energy generated for its own need sat its green tech park - an industrial estate where it manufactures renewable pulp and paper products - powered by zero waste technology and clean energy. The solar project will be installed in two phases.


December 2022

PETRONAS UNVEILS MALAYSIA’S FIRST EV HUB

Petronas Dagangan Bhd (PDB), in collaboration with Mercedes-Benz Malaysia and EV Connection, have unveiled Malaysia’s first electric vehicle (EV) charging hub on the North-South Expressway. The hub includes three DC fast chargers and two AC Gentari chargers and will be able to charge up to seven cars at any given time.

Additionally, to support its sustainable mobility efforts, PDB has signed two memorandum of understanding (MoUs) to develop battery swap stations for electric two-wheelers as well as charging points for e-buses. The company will also speed up the deployment of solar panels at its charging stations.


GOVERNMENT OF SARAWAK ALLOCATES RM 790 Mn FOR INFRA PROJECTS DURING 2023

The Government of Sarawak has allocated more than RM 790 Mn to fund four infrastructure programmes during 2023. Out of the total, more than RM 490 Mn has been allocated to develop land infrastructure while around RM 84 Mn has been earmarked for riverine infrastructure.

Some of the key projects to be undertaken by the Ministry of Infrastructure and Port Development in 2023 include the development of the Sarawak coastal road. Works include upgrading 331 km of the nearly 900 km road, building road links as well as replacing seven ferry crossings with bridges. The road project is expected to be completed in 2025.

Additionally, more than RM 157 Mn has been allocated to the Kuching Port Authority (KPA) to install quay cranes and a vessel traffic management system (VTMS), as well as build a vehicle yard and associated facilities.


MALAKOFF TO DEVELOP AND OPERATE ENERGY STORAGE SYSTEM AT AIRPORT IN JOHOR

Malakoff Radiance Sdn Bhd, a Malakoff Corp Bhd subsidiary, has signed a solar power purchase agreement (SPPA) with Senai Airport Terminal Services Sdn Bhd to build and operate a solar energy storage system at Johor’s Senai Airport, Malaysia. Under the terms of the SPPA, the company will manage the storage system under a build, own and operate (BOO) model for a period of 15 years.

The solar system will be able to generate around 800 MWh of renewable energy (RE) annually as well offset 555.2 tonnes of emissions per year. This move is in line with Senai Airport Terminal Services’ target of transitioning the Malaysian airport into a green airport.

 

List of key transactions - Malaysia Q4 2022

Source: Inframation, YOG INFRA analysis

 

ABOUT YOG INFRA

Our objective is to drive economic growth and make positive social impact through sustainable infrastructure development.

​YOG INFRA is an infrastructure focused financial advisory firm. We work with Developers and Development Finance Institutions (DFIs) and help them make informed investment decisions across infrastructure development lifecycle.

With our offices in Singapore and India, we work on projects globally, and the team brings strong experience in supporting development of infrastructure projects.


For more information about us, our service offerings and team, please visit www.yoginfra.com Contact us at info@yoginfra.com

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