KUALA LUMPUR (Feb 16): Dialog Group Bhd is setting up Terminal Langsat 3 at its terminal operations in Tanjung Langsat, Johor for storage of renewable fuel products with a capacity of 24,000 cubic metres.

This involves emerging product lines like biodiesel, sustainable aviation fuel and their associated feedstock. The filing, however, did not disclose the estimated costs for the expansion plan, which will commence immediately and is expected to be completed by 4Q2024.

The development is “largely in response to growing investor interest in low-carbon fuel alternatives”, Dialog said in a filing.

“In essence, this gives terminals a new lease of life and new value in the energy transition,” Dialog said.

Potential users, it said, include biofuel production companies, energy trading houses and multinational energy companies. The facility will be connected to truck loading bays and existing marine facilities, it said.

As at end-2021, Dialog’s Terminal Langsat total capacity stood at 855,000 cubic metres. Excluding its latest announcement, it has additional space of 17 acres of land with capacity of approximately another 200,000 cubic metres to be added, its annual report showed.

It also operates tank terminals across three phases in Pengerang with capacity totalling 3.83 million cubic metres, with 500 acres available for future development.

Separately, Dialog posted a net profit of RM127.15 million or 2.25 sen per share in its second quarter ended Dec 31, 2022 (2QFY23), down 0.6% year-on-year from RM127.88 million or 2.27 sen per share.

The weaker bottom line is due to higher project and operation costs, it said. The group also incurred higher finance costs in the period.

This is despite quarterly revenue rising 46.4% year-on-year to RM797.01 million from RM544.49 million in 2QFY22, on the back of higher business activities across local and international operations.

This was its highest topline since 3QFY18, when it booked revenue of RM867.37 million and net profit of RM118.84 million.

For the six-month period ended Dec 31, 2022 (1HFY23), Dialog’s net profit slipped 1.5% to RM252.94 million or 4.48 sen per share from RM256.69 million or 4.55 sen per share. Revenue however rose 43.7% to RM1.51 billion, from RM1.05 billion.

“As a leading integrated technical service provider that is diversified across the upstream, midstream, and downstream businesses of the energy sector, Dialog will remain focused and steadfast in the pursuit of its key long-term strategies,” it said.

Dialog owns a controlling stake in Thailand onshore oilfield operator Pan Orient Energy (Siam) Ltd, and has a 70% participating interest in the Baram Junior Cluster in Sarawak.

In the downstream segment, Dialog is actively involved in plant maintenance services in the Pengerang petrochemicals project. It is also venturing into production of recycled polymer resin as well as hydrogen.

Shares of Dialog settled down one sen or 0.39% at RM2.58, giving it a market capitalisation of RM14.57 billion.