Petronas to delay US$19 bln petrochemicals project to 2018

31-Jul-13

State oil firm Petronas has delayed the start up of its US$19 bln petrochemicals complex in Malaysia to 2018, as per Reuter. A delay to the project in southern Johor state could deal a potential blow to the economy of the Southeast Asian nation as well as local oil and gas services firms hoping for work on the massive complex. Sources opine that the project has been complicated by a need to secure water supplies as well as cater for proposed international partners. Petronas had already defered the project from late 2016 to early 2017 in June and revised the final investment decision (FID) to the first quarter next year, citing state government problems in relocating villages and graves from the 2,000 hectare-site, five times the size of New York's Central Park. Delays in the project - a cornerstone of Prime Minister Najib Razak's Economic Transformation Programme aimed at doubling Malaysians' incomes by 2020 - could slow an economy whose oil and gas sector makes up a fifth of GDP. The complex is the largest single investment in Malaysia, and aims to acquire a large portion of the US$400 billion global market for specialty chemicals. Its location at the southernmost tip of the peninsula, just 10 km (6 miles) from Singapore's east coast, is part of a vision for a "Greater Singapore" energy trading hub that would rival competitors such as China.