DIALOG Group Berhad (“DIALOG”) is pleased to announce that its wholly owned subsidiary, Dialog Equity (Three) Sdn. Bhd. (“DE3SB”) has on 17 January 2025, entered into:

• a Share Subscription Agreement (“SSA”) with Regas Terminal (Pengerang) Sdn. Bhd. (“RGTP”) to subscribe for 500 ordinary shares for subscription price of RM0.5 million and 9,724 redeemable preference shares for RM9.7 million;

• a Shareholders’ Agreement (“SHA”) with PETRONAS Gas Berhad (“PGB”) and RGTP to regulate the shareholders’ terms in relation to the special purpose vehicle, RGTP. RGTP is undertaking a project to design, build, and lease Air Separation Unit Facility (“ASU”) (“Project”). This Liquefied Natural Gas (“LNG”) driven Air Separation Unit Facility will have a combined capacity of 612 tonne per day (“TPD”) producing 460 TPD Liquid Nitrogen, 140 TPD Liquid Oxygen and 12 TPD Liquid Argon. The total awarded EPCC cost is RM368 million,

(collectively “the Transaction”).

RGTP, a wholly owned subsidiary of PGB will undertake the Project. DE3SB will subscribe for 27.78% shares in RGTP. This proposed venture marks another collaboration with PGB following the successful joint venture of Pengerang LNG (Two) Sdn. Bhd. (“PLNG2”) which is LNG regasification facilities at Pengerang in 2014.

The Project will be located on reclaimed land next to PLNG2 facility in Pengerang Deepwater Terminals, State of Johor where DIALOG through its other wholly owned subsidiary, Dialog Pengerang Sdn. Bhd, has been granted the land rights and development rights by the State Government of Johor Darul Takzim and the State Secretary, Johor under a Development Cum Joint Venture Agreement dated 13 May 2011. This Project will be developed under design, build and lease model. Under this concept, the ASU will be leased to an experienced industrial gas market player for a 25-year tenure, during which they will handle the operation, maintenance and marketing of the industrial gases produced from the ASU. In return, RGTP will receive fixed monthly facility charges as revenue.

The proposed venture will be in line with DIALOG’s aspiration of achieving Net Zero Carbon emission by 2050 as the Project is able to reduce electricity consumption by approximately 25% and lower carbon emission by 15,000 tonnes per annum compared to conventional ASU plant. It is a continuation of the initiatives by DIALOG to achieve business sustainability and to fulfill its Environmental, Social and Governance (“ESG”) agenda through commercially viable ventures. DIALOG remains committed to its core values and key strategies of a sustainable business by capturing opportunities and mitigating risks through its diversified portfolio.

The SSA and SHA will pave way for PGB and DIALOG to be strategic business partners in the equity ownership and development of the Project. This venture is expected to provide additional sources of long term sustainable and recurring income in the future of DIALOG. The chosen business model of design, build and lease model will mitigate merchant risk exposure and operational complexities. 

This announcement is dated 17 January 2025.