(AFP) National oil company Petronas has sealed a RM22.8 billion contract to supply liquefied natural gas (LNG) to a consortium of three Japanese firms for 20 years. The sale and purchase agreement was signed yesterday between Petroliam Nasional Bhd's (Petronas) unit, Malaysia LNG Tiga, and the consortium comprising Tokyo Gas Co Ltd, Toho Gas Co Ltd and Osaka Gas Co Ltd.

In a statement, Petronas said the contract to supply 1.6 million tonnes of LNG annually for 20 years beginning April 2004 was valued at about six billion dollars at current prices.

LNG will be supplied to the consortium from Malaysia LNG Tiga's plant in Bintulu in Sarawak to receiving terminals in Tokyo, Nagoya and Osaka, it said.

Petronas holds 60 percent equity in Malaysia LNG Tiga, the Sarawak state government 10 percent, Shell Gas BV 15 percent, Nippon Oil LNG (Netherlands) BV 10 percent and Diamond Gas Netherlands BV five percent.

Largest facility

The Malaysia LNG Tiga plant is the third production facility at the Bintulu LNG Complex and is scheduled to begin commercial operations in early 2003 with an annual production capacity of 6.8 million tonnes.

Once operational, it will make Bintulu LNG Complex the world's largest LNG production facility in a single location with a combined capacity of about 23 million tonnes annually, Petronas said.

The Japanese consortium currently receives a supply of 4.28 million tonnes of LNG per year from the other two production facilities at the Bintulu complex under existing long-term contracts.

Apart from the Japanese consortium, Malaysia LNG Tiga last year signed an agreement to supply up to 900,000 tonnes of LNG a year to Tohoku Electric Co Inc.

Today's New Straits Times said Malaysia supplies about 25 percent of Japan's LNG requirements through nine utility companies in Japan.