KUALA LUMPUR (May 8): Petronas Gas Bhd (KL:PETGAS) is partnering two Sabah state government-linked companies (GLCs) to jointly develop a 120MW power plant in Labuan.

In a filing with the stock exchange on Thursday, Petronas Gas said its wholly owned subsidiary, PG Energia Sdn Bhd, had entered into a shareholders’ agreement with Sustainable Power Sdn Bhd (SPSB) and SEC Power Sdn Bhd for the collaboration.

SPSB is a wholly owned unit of Sabah Electricity Sdn Bhd, while SEC Power is a wholly owned unit of Sabah Energy Corporation Sdn Bhd.

The target commercial operation date for the plant is set for no later than Jan 1, 2028, Petronas Gas noted.

PG Energia will be the majority shareholder of the joint venture with a 60% stake, while SPSB and SEC Power will each hold 20%.

According to Petronas Gas, the collaboration follows a letter of notification issued by the Ministry of Energy Transition and Water Transformation dated Feb 21, which approved the development of the power plant.

The joint-venture company, to be named Rancha Power Sdn Bhd, will be responsible for the design, construction, installation, testing, commissioning, ownership, operation, and maintenance of the power plant and its associated facilities.

Petronas Gas said the project will be financed through a combination of internally generated funds and external financing.

Shares in Petronas Gas ended four sen or 0.2% lower at RM17.24 on Thursday, giving it a market capitalisation of RM34.1 billion.