KUALA LUMPUR (April 2): An analyst has flagged a minimum RM18 million impact to Petronas Gas Bhd (KL:PETGAS) following a gas leak fire in Putra Heights on Tuesday. As a result, trading in Petronas Gas shares was halted for an hour until 10am on Wednesday. 

MIDF Research anticipates a knee-jerk reaction in the share price after the fire, which broke out at the Petronas Gas’ main pipeline near Puchong, resulting in 305 victims, most of whom suffered burns and heat inhalation injuries. Additionally, 237 homes, 275 cars, and 56 motorcycles were damaged.

Gas Malaysia Bhd (KL:GASMSIA) also halted trading in its shares for an hour on Wednesday after being notified of temporary closures at some gas facilities, which could cause supply disruptions in parts of the Klang Valley. The company is still assessing the impact and is in contact with the affected parties.

MIDF Research estimated that Petronas Gas will face a one-off impairment between RM18 million and RM25 million, which includes revenue loss from the affected pipeline (10%-15%), repair costs (25-30%), public compensation (25%-35%), and reputational management. The firm emphasised that this is a minimum estimate, as the actual impact will depend on the extent of the damage, for example medical, property and recovery time.

Additionally, MIDF anticipates at least two- to three months of extra costs, potentially up to RM5 million, for compensating industrial customers whose operations are directly affected by the damaged pipeline, such as delays or redirected gas sources. Since explosion damage takes months to repair, compensation for unaffected customers may only cover hours or days of disruption.

MIDF estimates that the financial impact on Petronas Gas’ total earnings will be about 1%-1.5%. The research firm is also reviewing Petronas Gas’ inclusion in its shariah top picks, which were recommended in its second-quarter 2025 report. It suggests that investors seeking exposure to the gas sector consider switching to Gas Malaysia.

Petronas Gas’ share performance on Wednesday is expected to influence the FBM KLCI benchmark, of which it is a constituent.

Regarding fire insurers, MIDF does not expect significant impact, as the majority of claims are likely to fall on Petronas’ public liability insurer. However, the identity of this insurer and the role of the federal government remain unclear. MIDF notes that LPI Capital Bhd (KL:LPI) has the largest exposure to fire-related gross written premiums under its coverage.

LPI’s share price was down marginally by 0.42% or six sen to RM14.34 a share earlier on Wednesday morning, bringing its market capitalisation to RM5.71 billion.

Petronas Gas’ shares last traded at RM16.88 a share, giving it a market capitalisation of RM33.4 billion, while Gas Malaysia last traded at RM4.31 a share, giving it a market capitalisation of RM5.53 billion.

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