KUALA LUMPUR (March 18): Gas Malaysia Bhd (KL:GASMSIA) has secured regulatory approval to advance its proposed liquefied natural gas (LNG) regasification terminal in Yan, Kedah, marking a significant step forward for project that is estimated to cost RM2 billion to RM3 billion.

The company said it had received a letter to proceed (LTP) from the Energy Commission, enabling the project to move into its next phase, which includes detailed engineering, financing arrangements and site preparation works.

Planned as a floating storage and regasification unit, the terminal will be located offshore west of Pulau Bunting in Yan. With a designed capacity of up to six million tonnes per annum, it is targeted to commence operations by 2029.

The regasification terminal forms part of the Pulau Bunting Integrated Development, a RM14.4 billion initiative launched in September 2022.

The integrated development includes a 1,600MW combined cycle gas turbine power plant, a ship-to-ship gas transfer hub, and the LNG terminal, designed to strengthen energy supply for the northern region of Peninsular Malaysia.

The development is a joint venture between MMC Group Bhd and SKS Corp Sdn Bhd.

Gas Malaysia emphasised in a bourse filing that the LTP is subject to conditions imposed by the Energy Commission, which must be fulfilled within the stipulated timeline. The company also clarified that the approval does not constitute a final investment decision, as regulatory requirements remain to be met.

While the project is expected to contribute positively to future earnings once operational, Gas Malaysia noted there will be no immediate material impact on its share capital or major shareholders’ holdings.

On Wednesday, shares in Gas Malaysia closed 19 sen or 3.6% higher at RM5.44, giving the company a market capitalisation of RM6.99 billion. Over the past year, the stock has gained 27.7%.