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Natural gas to play crucial role for national energy transition, says Muhyiddin

Natural gas to play crucial role for national energy transition, says Muhyiddin

03 Dec 2020

As Malaysia is navigating its way to an energy transition towards low-carbon energy sources, natural gas will play a pivotal bridging role for this transition, said Prime Minister Tan Sri Muhyiddin Yassin.

Malaysia currently relies a lot on coal, with natural gas accounting for about 40% of the energy source for the power sector.

For the energy transition, Muhyiddin said natural gas will provide a secure, affordable and sustainable baseload energy source in synergy with the growing but often intermittent renewable energy sources.

“The long-term outlook for gas, however, is brighter than that of other fossil fuels because of its comparatively lower cost and lower emissions from production,” he said when opening the International Energy Forum— International Gas Union Ministerial gas forum virtual roundtable.

To achieve this transition, Muhyiddin said the Government is currently drafting a Natural Gas Roadmap (NGR), as part of the National Energy Policy (NEP), that will be announced during the first quarter of 2021.

“The NGR among others strives to optimise the value of indigenous gas resources, enhance security of supply and access to cost-competitive gas, amongst others,” he added.

The roundtable dialogue involved Ministers and gas market stakeholders as they discussed inclusive and sustainable recovery plans from the Covid-19 pandemic to achieve shared goals in the gas industry.

Participants included 14 Ministers representing gas producers and consumers across world regions, 10 industry leaders from national and international energy companies, including new market entrants, heads of international organisations including the United Nations, as well as invited senior energy thought leaders.

At the same event, Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed suggested that propagating the use of natural gas as a transitional fuel may be a potential solution in responding to the alarming effects of climate change.

This, he said, should be done in parallel with accelerating the implementation of renewable energy and promoting energy efficiency.

“As a country that is both an exporter and importer of natural gas, Malaysia is determined to play an active role in global gas advocacy and participate in charting its future direction,” he said, noting that Malaysia is already among the top five gas exporters in the world.

For now, 30% of the gas produced in Malaysia is consumed domestically while the other 70% are exported, he said.

On the NEP, Mustapa said that, like many other countries in the world, Malaysia is aiming for a reduction in reliance on coal.

Although coal is considerably more economical, he said it may not be such a viable option due to its detrimental effects to the environment.

“In view of the shifting global energy landscape, Malaysia will undertake a study on its NEP, to determine policies and long-term strategies surrounding the national energy sector.

“This study will address the challenges faced by the energy sector, and identify new growth opportunities, while taking into account energy transition trends in balancing the energy trilemma — affordability, security and sustainability,” he said, adding that the NEP is still a work in progress.

Source: The Edge Markets

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