Malaysia to Review National Energy Policy
In view of the shifting global energy landscape, Malaysia will study its National Energy Policy (NEP), to determine policies and long-term strategies for the sector, Mustapa Mohamed, a minister in the prime minister’s department (economy), said on December 3 during the 7th IEF-IGU Ministerial Gas Forum, which was held virtually.
“This study will address the challenges faced by the energy sector, and identify new growth opportunities while taking into account energy transition trends in balancing the energy trilemma,” Mohamed said.
He said that the pace of the energy transition in southeast Asia, specifically the adoption of cleaner energy and electrification of vehicles, is expected to quicken in the wake of the Covid-19 pandemic. Mohamed advocated for the use of gas as a transitional fuel due to the inherent intermittency of renewable resources. He said that the power generation mix requires a fast-firing load-balancing fuel, to mitigate fluctuating supply.
“With this in mind, propagating the use of natural gas as a transitional fuel, while at the same time accelerating the implementation of renewable energy and promoting energy efficiency, as a medium to long-term development may be a potential solution in responding to the alarming effects of climate change,” he said.
Opportunities in Malaysia
Mohamed stressed that Malaysia’s natural gas industry presented a number of attractive market opportunities, across the gas value chain. An abundance of gas supply, a strong offshore pipeline system, and conducive government support, are among the main factors driving investments in gas in the country, he said.
The minister highlighted the measures the Malaysian government has taken to support the industry and mitigate the decline of indigenous gas production. The government has provided policy support and market liberalisation through the Gas Supply (Amendment) Act 2016, and the introduction of third-party access.
“In addition to a healthy gas market, well-developed infrastructure and attractive fiscal incentives have been designed to attract potential investors. As a result, Malaysia is viewed as among the world’s top investment destinations for the energy sector, with more than 5,000 companies from over 40 countries calling Malaysia their business home,” he said.
Greater collaboration
Speaking at the same event, Petronas CEO Tengku Muhammad Taufik, said that the new energy landscape called for greater collaboration between gas producers, consumers and governments to ensure that gas as the preferred fuel of choice which benefits all stakeholders.
“Petronas' position is that we must continue to advocate for gas and LNG. It is an integral part of low carbon agenda that will support and accelerate the energy transition,” Taufik said. “As a long-term LNG player, we are fully invested to unlock its potential.”
He argued that gas and LNG are extremely well-positioned to be the global aspiration for affordable, secure and sustainable energy, capable of addressing the intermittency issues of renewables.
“Demand for gas will be spurred by emerging markets, especially in Asia. Gas and LNG will become the fuel of choice for many to embrace this energy transition,” Taufik said.