Integrated engineering solution provider Kelington Group Bhd has secured a deal to build a carbon dioxide (CO2) gas purification plant in Malaysia, following a supply agreement with Petroliam Nasional Bhd (Petronas).
In a filing with Bursa Malaysia, Kelington said its 94% owned subsidiary Ace Gases Sdn Bhd had signed a supply agreement with Petronas for the sale and purchase of CO2 waste gas.
Under the scope of the agreement, the Petronas Gas Processing Plant in Kerteh, Terengganu, will supply CO2 waste gas in excess of 50,000 tonnes per year to a new neighbouring gas plant which will be established by Kelington. Kelington will purify and liquefy the waste gas to produce liquid CO2 to be sold to the end users.
The group said the tenure of the agreement is 15 years commencing in 2019, and the renewal is subject to mutual agreement of the parties upon expiry.
A press release stated, “The agreement is on a call-out basis whereby the orders will be issued at the discretion of Petronas based on the schedule of rates set forth in the agreement.”
“The purchase of CO2 waste gas will be funded through internally generated funding.”
“The agreement is not expected to contribute to the earnings and net assets of Kelington Group for the financial years ending 31st December 2017 and 31st December 2018. However, the agreement is expected to contribute positively to the earnings and net assets per share of Kelington Group for the financial year ending 31st December 2019.”