Malaysian pipeline to boost Asia's energy security
A 7 billion dollar pipeline to be laid across northern Malaysia will divert up to a third of oil now being carried through the Malacca Strait, ensuring a secure supply from the Middle East to East Asia, officials said on Monday.
By Agencies |
KUALA LUMPUR: A 7 billion dollar pipeline to be laid across northern Malaysia will divert up to a third of oil now being carried through the Malacca Strait, ensuring a secure supply from the Middle East to East Asia, officials said on Monday.
Under the plan, crude oil shipped from the Mideast would be refined in Kedah on the northwestern coast and pumped through the 300-kilometer pipe to Kelantan on the eastern coast. It would then be loaded onto tankers bound for Japan, China and South Korea, completely bypassing Singapore and the Malacca Strait.
Work on the pipeline will begin next year and finish in 2014, said Rahim Kamil Sulaiman, chairman of the project owner, Trans-Peninsula Petroleum Sdn. Bhd. "This is not a political project. It is a commercial undertaking. The project is economically viable," he told a news conference.
Rahim said the pipeline will be a substitute for the Strait of Malacca, through which half the world's oil is shipped. The strait is also notorious for robberies and hijackings, although the number of attacks has fallen since Malaysia, Indonesia and Singapore, which share the waterway, increased patrols in 2005. Around 30 per cent of vessels that transit the strait are oil tankers, he said, adding that the company aims to divert 30 per cent of the traffic once the pipeline is completed.
Rahim said the timing of the pipeline is perfect as the oil market is shifting to East Asia, with China now being the world's second-largest oil consumer.
Under the plan, crude oil shipped from the Mideast would be refined in Kedah on the northwestern coast and pumped through the 300-kilometer pipe to Kelantan on the eastern coast. It would then be loaded onto tankers bound for Japan, China and South Korea, completely bypassing Singapore and the Malacca Strait.
Work on the pipeline will begin next year and finish in 2014, said Rahim Kamil Sulaiman, chairman of the project owner, Trans-Peninsula Petroleum Sdn. Bhd. "This is not a political project. It is a commercial undertaking. The project is economically viable," he told a news conference.
Rahim said the pipeline will be a substitute for the Strait of Malacca, through which half the world's oil is shipped. The strait is also notorious for robberies and hijackings, although the number of attacks has fallen since Malaysia, Indonesia and Singapore, which share the waterway, increased patrols in 2005. Around 30 per cent of vessels that transit the strait are oil tankers, he said, adding that the company aims to divert 30 per cent of the traffic once the pipeline is completed.
Rahim said the timing of the pipeline is perfect as the oil market is shifting to East Asia, with China now being the world's second-largest oil consumer.
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