Corporate Communication Key ConceptsIn

Malaysia Liquid and Gas (MLNG)(200866-W)

UC00102Corporate Communication

Jamsari Bin HashimGroup 1

No. Name Matric No Section

Project Paper (40%)

Project Paper

Presentation (30%)

1. FELIX BK 22. HO KOON

CHANGBK

11110105 2

3. IAN LEVI JACKERY BS 2

4. NUR FATANAH BS 25. REO RICKIE H

BATINGBK

11110257 2

Tuesday1100-1300

DKP 13Semester II

2011/2012 Session

CONTENT

No. CONTENT PAGE

1. MISSION

2. VISION

3.OBJECTIVES AND

GOALS

4. STRATEGIES

5. IDENTITY

6. IMAGES

7. REPUTATION

8. STAKEHOLDER

9. PUBLIC

10. MARKET

11. ISSUE

12. COMMUNICATION

INTRODUCTION

(a) BACKGROUND OF THE ORGANIZATION

PETRONAS' venture into the liquefied natural gas (LNG)

industry more than three decades ago marked Malaysia's entry into

the modern gas era. When substantial gas reserves were discovered

in Sarawak's Central Luconia basin in the 1970's, it was hoped that

monetising this resource would bring revenue and foreign exchange

needed to spearhead Malaysia's socio economic development and

nation building. It was also realised then that Malaysia's proximity to

industrialised Japan, opened the opportunity for PETRONAS to tap

into an important energy market in need of a cost effective, efficient

and cleaner energy resource.

PETRONAS,Shell BV and Mitsubishi held talks which resulted in

the birth of a partnership to undertake Malaysia's first LNG project,

realised through the incorporation of Malaysia LNG Sdn Bhd or

MLNG on 14 June 1978.

The MLNG project was Malaysia's largest and most ambitious

industrial undertaking at the time and the Malaysian Government

established a special LNG task force to see to its successful

completion. The MLNG project at that time was also the nation's

single largest investment in manufacturing and required what was

considered a quantum leap in technology and knowledge

acquisition. Beyond the construction of the plant, the MLNG project

also involved the construction of a jetty, the acquisition of LNG

carriers, the establishment of infrastructure and amenities and the

training of human resource.

Through hard work and perseverance, the partners in the

initial venture succeeded in transforming the sleepy fishing village

of Bintulu into the site of Malaysia's first gas liquefaction plant,

which was completed on schedule on 7 August 1982. The LNG

complex saw its first cargo destined for the Japanese market leaving

Bintulu on 29 January 1983 on board LNG carrier Tenaga Satu.

Escalating demand for LNG led to the formation of the second

and third joint-venture companies respectively - Malaysia LNG Dua

Sdn Bhd (MLNG Dua) in 1992, and Malaysia LNG Tiga Sdn Bhd

(MLNG Tiga) in 1995.

Indeed, Petronas' entry into the LNG business was a milestone

in the Corporation's journey towards becoming a fully-integrated oil

and gas player. It also marked a major leap for the Corporation in

terms of capability building and technology development, as the

pioneers in the LNG venture persevered to beat insurmountable

odds.As a result of the LNG project, PETRONAS' employees rapidly

acquired capability in every aspect of the LNG business, from plant

construction, commissioning and operations to marketing and

logistics.

The Central Luconia gas fields are about 125 - 275 km

offshore to Bintulu where the sea depth ranges between 60 and 120

metres. The gas reservoirs are at depths of 1,200 to 2,130 metres

below the sea bed. In the process of evaluating the discoveries,

Sarawak Shell Berhad drilled 94 exploration wells in the period 1968

- 1981.

The E11 gas field in the Central Luconia gas province was

discovered in January 1971. Evaluation of this find established with

adequate certainty that there was sufficient gas to make it

worthwhile to consider a large project to export gas in liquid form

i.e., liquefied natural gas or LNG.

(i) THE HISTORY OF MLNG

1965-1969

1967 - 1969

Discovery of substantial natural gas reserved in the Central

Luconia gas fields, about 125 - 250 kilometres offshore

Bintulu, Sarawak.

1970-1974

1973

The proposal to establish the LNG project in Malaysia was

submitted to the Malaysian Government by the Coordinating

Committee on Hydrocarbons. The Committee was set up by

the Malaysian Government, in the wake of OPEC's oil embargo

in the same year, to coordinate all matters pertaining to

petroleum resources, which paved the way for the enactment

of the Petroleum Development Act 1974 and the

establishment of PETRONAS.

1974, August 17

The national oil corporation of

Malaysia, PETRONAS, the acronym for

Petroliam Nasional Berhad, was

registered under the Companies Act, 1965.

1974, October 1

The Petroleum Development Act (PDA) was passed by

Parliament and came into force, vesting upon PETRONAS the

legitimate rights, powers, liberties and privileges in respect of

petroleum resources development in Malaysia. The

establishment of PETRONAS was the starting point for greater

national control and participation in the petroleum industry.

1975-1979

1975

The LNG Task Force was established by YAB Prime Minister

Tun Abdul Razak Hussein, to undertake the implementation of

Malaysia's first LNG Project.

1976, February

Negotiations were held between PETRONAS, Shell and

Mitsubishi to consider the manner in which the LNG project

should be initiated. Formal approval was granted by the

Government to PETRONAS to implement the LNG project.

1978, March 31

Signing of a Joint Venture Agreement

to set up Malaysia LNG Sdn. Bhd. to

own and operate the new three-train

LNG project. Parties to this agreement are PETRONAS (65%),

Shell Gas B.V. (17.5%) and Mitsubishi Corporation (17.5%).

1978, June 14

Incorporation of Malaysia LNG Sdn Bhd (MLNG).

1979, September 13

Letter of Intent for the LNG Sale and Purchase Agreement with

Tokyo Electric and Tokyo Gas was concluded in Tokyo.

1979, September 28

Letter of Intent was signed between MLNG and a

Japanese/American consortium - JGC Corporation of Japan and

the Pullman Kellogg division of Pullman Incorporation, for the

construction of the multi-million dollar LNG complex.

1979, November

MLNG signed Letter of Intent for the LNG Sales and Purchase

Agreement, with Tokyo Electric and Tokyo Gas.

1980-1984

1980, June 20

MLNG Signs Main Contract Agreement

with a consortium comprising JGC

Corporation, Kellogg Overseas

Construction Corporation/Pullman Kellogg of the United States,

for the construction of the MLNG plant.

1982, August 8

The first LNG train (Module) is successfully pre-commissioned,

with the first flow of gas into the Plant.

1982, September 1

MLNG officially moved its head office premises from Kuala

Lumpur to Bintulu.

1983, January 8

MLNG Plant commenced production of

LNG.

1983, January 27

The First Loading of LNG into the tanker.

1983, January 29

MLNG sent 1st LNG Cargo to Tokyo Electric Power Co. Inc. and

Tokyo Gas Co. Ltd. of Japan.

1983, February 4

The Sale and Purchase Agreement between Tokyo Electric

Power Co. Inc and Tokyo Gas Co. Ltd, was signed in Tokyo.

1983, February 7

"TENAGA SATU" berthed at Tokyo Gas,

Sodegaura Works, with her 1st LNG

Cargo from MLNG.

1983, March 27

MLNG signed the LNG Sale and Purchase Agreement with

Tokyo Electric Power Co Inc. and Tokyo Gas Co. Ltd.

1985-1989

1985, March 20

MLNG successfully delivered its 100th LNG Cargo to its

customers.

1985, September 20

MLNG sent 1st LNG Cargo to Tokyo

Electric Power Co Inc.

1985, November 22

Sarawak State Government became the fourth partner of

MLNG when it acquired 5% of the company's equity with

PETRONAS holding 65% and Shell Gas B.V. and Mitsubishi

Corporation owning 15% each (with the signing of the Specific

Agreement).

1989, April 6

MLNG successfully delivered 500th LNG cargo to its

customers.

1990-1994

1990, August 30

MLNG signed 20-year Sale and Purchase Agreement with

Saibu Gas Co. Ltd.

1992, May 26

Signing of a Joint Venture Agreement to set up Malaysia LNG

Dua Sdn Bhd to own and operate the new three-train LNG

expansion project. Parties to this agreement are PETRONAS

(60%), Shell Gas B.V. (15%), Mitsubishi Corporation (15%) and

the Sarawak State Government (10%).

1992, June 1

Incorporation of Malaysia LNG Dua Sdn Bhd (MLNG Dua).

1993, April 7

MLNG successfully delivered 1000th LNG Cargo to its

customers.

1993, May 24

MLNG sent 1000th LNG Cargo to Tokyo Electric Power Co. Inc.

and Tokyo Gas Co. Ltd. This marked the half-way stage of the

20-year contract with both companies.

1993, June 28

MLNG signed Sale and Purchase Agreement (SPA) with Korea

Gas Corporation for supply of LNG for 20 years, beginning

1995.

1993, October 20

MLNG sent 1st LNG Cargo to Saibu Gas

Co. Ltd. Japan.

1994, July 27

MLNG signed a Sale and Purchase Agreement with Tohoku

Electric.

1994, December 5

MLNG signed a Sale and Purchase Agreement with the

Japanese Gas Consortium (GCKE) comprising Tokyo Gas

(MLNG's established/earliest customer), Osaka Gas, Kansai

Electric and Toho Gas.

1995-1999

1995, March 22

MLNG signed a Sale and Purchase Agreement with Chinese

Petroleum Corporation (CPC), the first long-term customer

from Taiwan.

1995, May 19

MLNG sent 1st LNG Cargo to Chinese

Petroleum Corporation (CPC) Taiwan.

1995, May 30

MLNG sent 1st LNG Cargo to Japanese Gas Consortium/Kansai

Electric (GCKE).

1995, June 26

MLNG sent 1st LNG Cargo (FOB) to Korea Gas Corporation.

1995, November 15

MLNG signed a Sale and Purchase Agreement with Gas

Bureau, City of Sendai.

1995, November 8

Incorporation of Malaysia LNG Tiga Sdn. Bhd.

1995, December 8

Signing of a Joint Venture Agreement

to set up Malaysia LNG Tiga Sdn. Bhd.

to own and operate the new two-train

LNG expansion project. Parties to this agreement are

PETRONAS (60%), Sarawak State Government (10%), Shell

Gas B.V. (15%), Nippon Oil LNG B.V. (10%) and Diamond Gas

B.V. (5%).

1996, April 23

MLNG signed ex-ship Sale and Purchase Agreement with

Shizuoka Gas.

1996, May 29

MLNG sent 1st LNG Cargo to Tohoku Electric Power Co.

1996, May 29

MLNG sent 1st LNG Cargo to Shizuoka Gas Co. Ltd.

1997, May 28

MLNG sent 1st LNG Cargo to Gas Bureau, City of Sendai,

Japan.

1998, February 11

MLNG successfully delivered 2000th LNG Cargo to its

customers.

1998, November 6

1st night berthing for LNG tanker - "Tenaga Dua".

2000-2004

2001, April 16

MLNG Tiga signed a Sale and Purchase Agreement with

Tohoku Electric Power Co., Inc.

2001, June 10

MLNG successfully delivered 3,000th

LNG Cargo to its customers.

2002, February 19

MLNG Tiga signed a Sale and Purchase Agreement with the

Japanese Gas Consortium (GC) comprising Tokyo Gas (MLNG's

established/earliest customer), Osaka Gas and Toho Gas.

2002, April 9

MLNG Tiga signed a Sale and Purchase Agreement with Japan

Petroleum Exploration Co. Ltd. (JAPEX).

2003, January 6

Incorporation of ASEAN LNG Trading Co. Ltd. (ALTCO), a

trading company whose principal activity is to conduct a

global business buying and selling LNG, chartering LNG ships,

transporting and supplying LNG and re-gasified gas.

2003, February 8

PETRONAS increased equity in MLNG to 95% (from 65%) upon

the expiry of the Joint Venture Agreement with Shell Gas B.V.

and Mitsubishi Corporation.

2003, March 17

MLNG renewed Sales & Purchase

Agreement (SPA) with Tokyo Electric

Power Co. Inc. and Tokyo Gas Co. Ltd.

for the supply of LNG for 15 years beginning 2003. In 1983,

Tokyo Electric Power and Tokyo Gas became the pioneer

buyers of LNG from Malaysia when they signed a 20-year

contract with MLNG. After this contract expired, a new

agreement marked another milestone in the long-term

relationship between MLNG and the two buyers, and was a

testimony to MLNG's reputation as a stable, reliable and

competitive LNG supplier.

2003, March 26

MLNG Tiga sent 1st LNG cargo to Japan Petroleum Exploration

Co. Ltd. (JAPEX).

2003, May 8

Official launching / opening of the PETRONAS LNG Complex in

Bintulu by Y.A.B. Prime Minister Dato Seri Dr. Mahathir

Mohamad.

2003, May 9

MLNG Tiga signed a Sale and Purchase

Agreement (SPA) with Korea Gas

Corporation (KOGAS) to supply LNG for

seven years.

2003, December 1

Mitsubishi Corporation acquired 5% equity in MLNG from

PETRONAS, changing the PETRONAS' stake to 90%, while

Sarawak State Government held the remaining 5%.

2004, April 16

MLNG Tiga sent 1st LNG Cargo to Japanese Gas Consortium

(GC).

2005-2009

2005, April 5

MLNG Tiga sent 1st LNG Cargo to Tohoku Electric Power Co.,

Inc.

2005, July 4

MLNG signed a Sale and Purchase Agreement (SPA) with

Hiroshima Gas Co., Ltd. (Hiroshima Gas) to supply LNG for

eight years.

2005, July 12

MLNG Tiga signed a Sales & Purchase

Agreement (SPA) with Korea Gas

Corporation (KOGAS) for supply of LNG

for 20 years beginning 2008. The relationship between MLNG

and KOGAS started in 1991 with sales of spot cargoes,

followed by a long-term contract signed in 1993, expanded

into medium-term and short-term supply contracts in 2003

and 2004 respectively. The signing of a long-term contract

marked another important milestone, and was testimony to

the spirit of mutually-beneficial relationship between the two

companies.

2006, March 2

MLNG Tiga signed a Sale and Purchase Agreement with Toho

Gas Co., Ltd. Toho Gas, the third largest gas company in

Japan, has been importing LNG from MLNG since 1995 under a

20-year supply contract, signed in 1994 through a consortium

of Japanese companies of which Toho Gas is a member. The

signing of a new SPA marked the first supply deal for Toho Gas

as a single buyer.

2006, April 7

MLNG signed a Confirmation of Intent

(COI) with Osaka Gas Co. Ltd (Osaka

Gas) to supply LNG for 15 years

beginning April 2009. The long term relationship with Osaka

Gas, the second largest gas company in Japan, started in 1994

when MLNG signed a 20-year supply contract with a

consortium of Japanese companies of which Osaka Gas is a

member. In 2002, the consortium signed a contract with MLNG

Tiga, for the supply of LNG for a period of 20 years from 2004.

The new signing marked another important milestone for

Osaka Gas, as this was its first supply deal signed

independently with MLNG.

2006, April 25

MLNG signed a Sale and Purchase Agreement with Chubu

Electric Power Company, Incorporated. The relationship

between MLNG and Chubu Electric existed in 1991, 2001,

2002 and 2004, when MLNG sold spot ex-ship LNG cargoes to

the Company. The new SPA was its first long-term contract

with MLNG.

2006, July 21

MLNG Tiga signed a Sale and Purchase Agreement with

Shanghai LNG Company Limited for supply of LNG for 25 years

beginning 2008. The signing of the SPA marked a major

breakthrough for PETRONAS into China's energy sector. This

was PETRONAS' first LNG deal with China. The deal further

enhanced the economic ties between the two countries.

2006, November 9

MLNG successfully delivered 5,000th LNG Cargo to its

customers

2007, March 8

MLNG signed a Sale and Purchase Agreement (extension) with

Saibu Gas Co. Ltd. for supply of LNG for another 15 years

beginning 2013. The new SPA was a testimony to the spirit of

long-term mutually-beneficial relationship between MLNG and

Saibu Gas that was forged when the two parties first sealed a

20-year supply contract in 1990.

2007, May 11

MLNG Dua signed a Sale and Purchase

Agreement with Shikoku Electric

Company Limited for supply of LNG for

15 years beginning 2010. The deal increased MLNG's portfolio

of Japanese customers to 15.

2007, November 19

MLNG signed a Sale and Purchase Agreement with Osaka Gas

Co., Ltd., for supply of LNG for 15 years beginning 2009. The

long term relationship with Osaka Gas, the second largest gas

company in Japan, started in 1994 when MLNG signed a 20-

year supply contract with a consortium of Japanese companies

of which Osaka Gas is a member. The COI with Osaka Gas was

signed in April 2006.

2008, January 29

MLNG celebrates the 25th anniversary of Malaysia's 1st LNG

Cargo to Japan.

(b) RATIONALE CHOOSING THIS ORGANIZATION

MLNG proven capability in operating a fully integrated LNG

operation is among their greatest strengths. The availability of gas

resources from our upstream operations has enabled PETRONAS to

diversify into downstream gas liquefaction activities in Malaysia and

increasingly overseas, in line with our value-adding, business

integration and globalisation strategy.

By leveraging on their ability to ensure security of supply from our

gas reserves, and synergy of connectivity throughout the whole value

chain of our LNG business, they are able to meet their customer's

needs with a high level of reliability and flexibility.

It was over three decades ago when PETRONAS carried out detailed

studies on the feasibility of implementing a Liquefied Natural Gas

(LNG) project in Sarawak. Through joint ventures with other global

players, they have successfully developed their resources and realised

their vision to monetise the gas reserves of the Central Luconia Basin

offshore to Sarawak. The integration of the three LNG plants formed

the world's largest LNG production facility at a single location - the

PETRONAS LNG Complex at Bintulu, Sarawak, in East Malaysia.

Since the first LNG shipment in 1983, the LNG Complex has proven

to be a reliable supplier of LNG to our overseas customers and has

generated significant contributions in terms of foreign exchange

earnings for the country.

The PETRONAS LNG Complex has not only positioned PETRONAS as

a formidable player in the global LNG market, but also stands as a

testimony to the capability of Malaysians in participating and

successfully undertaking a complex world scale mega project, with

perseverance and strong teamwork. The integrated LNG project is a

successful collaboration between the government and the private

sector, and a partnership between the producing and importing

countries. In current parlance, it is a Malaysia Incorporated and smart

partnership.

MISSION

MLNG is in the business of manufacturing and marketing LNG.

As a key player in the LNG business, they seek to be a reliable and

preferred supplier of LNG.

As a leading producer of LNG, they will operate in a safe and

efficient manner, consistent with best practices, government

regulations and international standards.

As a JV company, they will optimise the use of resources, maximise

our revenue and ensure commensurate return on investment to their

Shareholders.

As a responsible corporate citizen, they will maximise our foreign

earnings for the benefit of the country and the well-being of the people.

As a caring employer, they will create an environment of mutual

respect and trust among our employees.

VISION

To be a global LNG player, continually creating value to our stakeholders

and preferred by customers.

MLNG’s vision “To be a global LNG player, continuously creating value to

its stakeholders and preferred by customers”, is supported by our

achievement of superior performance through managing our assets

safely, reliably, and cost effectively.

To support the vision, we shall strive to implement our Reliability and

Integrity Management System (RIMS) effectively to achieve “Superior

Performing Asset” of our facilities in accordance with the following

principles:

Nurture a risk based reliability and integrity centred culture in the

company by having challenging reliability and integrity targets,

implementing initiatives towards achievements of these targets,

monitoring and owning the performance at all levels.

Adopt standards and procedures from Petronas and other relevant

renowned international bodies or organizations, industry applicable best

practices into the design, modification, operation and maintenance of

our facilities.

Ensure there are sufficiently trained personnel to safety and effectively

manage, supervise, operate and maintain our facilities in accordance

with statutory regulations, and approved standard guidelines and

procedures.

Continually improve our RIMS effectiveness by conducting external

benchmarking with other LNG producers, international Situational

Assessment and ensuring that measures are taken to close any gaps

identified,

Together we can achieve our organisational goals and support Petronas

towards Global Championship.

OBJECTIVES AND GOALS

1. What are the goals?

STRATEGIES

A marketing strategy must be created in order to determine the means by

which a set of clear objectives may be met. Objectives communicate what

marketers want to achieve, guide marketing actions and are used to

measure how well a plan is working. They can be related to market share,

sales reaching the target audience and creating awareness in the

marketplace. The marketing strategy is the statement of how objectives

will be delivered. It explains what marketing actions and resources will be

used and how they will work together.

a. Product

The important thing to remember when offering items to potential

customers is that there is a huge amount of choices available to

those potential customers with regard how and where they spend

their money. Therefore, MLNG places considerable emphasis on

developing what customers want. However, customers’

requirements change over time. What is attractive today may be

discarded tomorrow. Marketing continuously monitors customers’

preferences. MLNG currently produces three main products for

export. These are LNG, LPG and Gasoline.

i. LNG

Liquefied Natural Gas (LNG) is an odourless, colourless, non-

corrosive and non-toxic product of natural gas consisting

primarily of methane (CH4) that is in liquid form at near to

atmospheric pressure. This is clean fuel. Natural gas is

increasing becoming the fuel of choice for customers around

the world due to its clean-burning and lower emission

qualities. LNG is a way of delivering natural gas to all corners

of the globe, safely and reliably. Currently MLNG supply LNG

under long term contracts to customers in Japan, Korea,

Taiwan and China.

ii. LPG

Propane and Butane, normally termed as LPG, is gaseous

hydrocarbons at normal temperature and pressure but readily

turn into liquids under moderate pressure at normal

temperature. MLNG export this product to Vietnam, India and

Philippines. MLNG also bottle them domestic market.

iii. Gasoline

Stabilized Gasoline from MLNG and MLNG Tiga Fractionation

units. MLNG Dua Stabilization Unit as well as MLNG Tiga

Condensate Stabilization unit. MLNG sell this product to

Bintulu Crude Oil Terminal (BCOT).

IDENTITY

With the phenomenon of ‘globalization’, companies have their eyes firmly

fixed on global expansion. This expansion has caused the businesses to

set up quality standards for proper branding and management of their

products. That’s why the need to establish a proper and authentic

trademark has never been so direly needed. A trademark is a guarantee

of consistency and quality. It assures the customers that all the products

bearing a specific trademark are of the same quality everywhere in the

world.

MLNG Shared Values

Loyalty

Professionalism

Integrity

Cohesiveness

Board of Directors

Malaysia LNG Sdn Bhd

Chairman

Dato’ Shamsul Azhar Abbas

Members

M Sabarudin M Amin 

Datuk Wan Zulkiflee Wan Ariffin

Datuk George Ratilal

Samsudin B. Miskon

Datuk Mohd Zain Abdul Majid

Tan Sri Datuk Amar Hj Abdul Aziz B. Hj Husain    (alt: Dato Sri Ahmad

Tarmizi Hj Sulaiman)

Kazuyuki Mori    (alt: Junichi Iseda)

IMAGES AND REPUTATION

STAKEHOLDERS

The Stakeholder Model

A stakeholder is defined as any individual or group who has an

interest in the success of the business. It is worth noting the reference to

'success' because this would exclude competitors from the model.

Competitors may have an interest in seeing the business decline but not

necessarily in its success so for that reason we are excluding this group.

The Shareholders List

1. PETRONAS BERHAD

Petronas Bhd was established as Malaysia’s national oil company in

1974 to develop and manage the country’s oil and gas resources. It is

wholly-owned by the Malaysian Government and is vested with the entire

ownership and control of the petroleum resources in Malaysia through the

Petroleum Development Act 1974.

Over the years, Petronas has grown to become a fully integrated oil

and gas corporation and is ranked among the FORTUNE Global 500®

largest corporations in the world. Petronas has four subsidiaries listed on

the Bursa Malaysia and has ventured globally into more than 30 countries

worldwide in its aspiration to be a leading oil and gas multinational of

choice.

The company’s gas experience was demonstrated with the

successful commissioning of MLNG Satu in 1982 and its global LNG

venture in Egypt, Australia and many more.

2. SHELL

Shell is a global group of energy and petrochemical companies, operating

in more than 140 countries and territories. Since 1907, the Shell group

has grown and developed its business interest around the world. Shell

delivers a wide range of energy solutions and petrochemicals. These

include transporting and trading oil and gas, marketing natural gas,

producing and selling fuels for ships and planes, generating electricity and

providing energy efficiency advice. Shell also produces and sells

petrochemical building blocks to industrial customers globally and is

investing in renewable and lower-carbon energy resources competitive for

large-scale use.

3. Sarawak Government

The current Sarawak Government is formed by four Barisan Nasional

(National Alliance) component parties namely Parti Pesaka Bumiputera

Bersatu, Sarawak United People’s Party, Sarawak Progressive Democratic

Party and Parti Rakyat Sarawak. The government holds equity stake in

most oil and gas companies operating in the State.

4. Mitsubishi Corporation

Mitsubishi Corporation (MC) is Japan's largest general trading

company (sogo shosha) with over 200 bases of operations in

approximately 80 countries worldwide. Together with its over 500 group

companies, MC employs a multinational workforce of approximately

60,000 people. MC has long been engaged in business with customers

around the world in virtually every industry, including energy, metals,

machinery, chemicals, food and general merchandise.

5. Nippon Oil Corporation

Nippon Oil Corporation is a Japan-based supplier of petroleum

products. The Company operates in four business segments. The Oil

Refinement and Sales segment is engaged in the refinement and

processing of petroleum products, as well as the manufacture and sale of

petrochemical products. This segment is also engaged in the storage and

transportation of its petroleum products, as well as the purchase and sale

of coal and other mining products.

The Petroleum and Natural Gas Development is engaged in the

exploration and development of petroleum and natural gas. The

Construction segment is involved in road construction and civil

engineering works, as well as the design and construction of oil-related

facilities. The Others segment is involved in the real estate, automobile-

related and other businesses.

6. Diamond Gas Operation Co. Ltd. (DGO)1Diamond Gas Operation Co. Ltd. (DGO) is a wholly-owned

subsidiary of Mitsubishi Corporation. It was established in 1990 to

handle the practical business related to customs clearance and

payment settlements relating to MC's LNG suppliers in Alaska,

Brunei, Malaysia, Indonesia and other countries in which MC is

involved—areas supplying a total of about 20 million tons of LNG a

year. In addition to this, DGO collects information about natural gas

and other relevant industry information from all over the world and

provides it to customers—including electric power companies, gas

companies, government agencies, petroleum companies,

shipbuilding companies, plant engineering companies and banks—

by issuing and delivering a weekly newsletter named "Diamond Gas

Report (DGR)." As an additional service to its customers, DGO has

also started to provide Natural Gas-related information via its

website.

1 http://www.mitsubishicorp.com/jp/en/bg/energy/investments/dngb2.html

PUBLIC

i. Giving Back to the Society

MLNG is proud to represent a country rich in tradition, history and

natural resources. MLNG position as a leader in Malaysia’s energy

industry is an opportunity for MLNG to support important social

development initiatives that will continue to improve the lives of the

people of this country. Corporate citizenship forms an integral part of

the company’s vision.

Apart from providing valuable assistance to health, safety,

education and sport programmes throughout Malaysia, MLNG will

ensure that the people of Bintulu and generally Sarawak will continue

to benefit directly from the LNG project which acted as catalyst for the

development of basic infrastructures such as roads, water, electricity,

housing and schools, as well as telecommunications, customs services

and civil aviation facilities.

The LNG project also became the catalyst for other gas-related

projects to emerge in the area, which added value and further

diversified the output from this resource. Bintulu became the site for

an ASEAN joint-venture granular urea fertiliser plant, and a high

technology middle distillate synthesis plant, converting natural gas into

quality petroleum products. With the proliferation of these activities,

Bintulu became a regional growth centre attracting some of the state's

leading development projects including a deep-water port and

container terminal, a power plant, and other infrastructural support

facilities.

In addition to the new LNG infrastructure and facilities, the people of

the state of Sarawak have gained tremendously through increased

employment opportunities. Through job-based skills training, Sarawak

today boasts a competent and committed workforce; motivated by the

rapid development they witnessed first-hand in their villages and

towns.

Today, the entire management team at the PETRONAS LNG

Complex is Malaysian, signifying the successful transfer of capability

and expertise to the nation. In addition, the experience gained by our

local workforce has opened up more opportunities for these skilled staff

to move to other PETRONAS projects in Malaysia and overseas, and

other foreign oil and gas ventures around the world.

The PETRONAS LNG Complex is an active member of the community

in Bintulu and MLNG’s staffs enjoy many opportunities to engage with

the residents. Throughout the years, MLNG has built up strong

relationship with the community through annual activities like sporting

events, festive celebrations, education sponsorships, school-based

tutorial and motivational camps, health and safety workshops, and

environmental projects.

Through these community programmes, we shoulder a continuous

responsibility to progressively, proactively and positively contribute to

the society in Bintulu, as well as in areas of our operations around the

globe. PETRONAS hopes to inspire our partners, employees and

stakeholders to participate in our mission to enrich the lives of the

millions of people we touch.

ii. Growing With the Local Community

MLNG companies and their joint venture partners have contributed

tremendously to nation building. This can be gleaned from the massive

transformation of Bintulu town from a sleepy fishing village in the late

70s to a bustling industrial township today. MLNG has also brought

significant socio-economic and infrastructural transformation to the

surrounding areas of Bintulu.

Sarawakian especially the people of Bintulu have benefitted directly

from the LNG projects through various modernization undertakings

which have resulted in the provision of infrastructure such as roads,

water, electricity, housing and schools, as well as telecommunication,

customs and civil aviation facilities.

The PETRONAS LNG Complex is an active member of the community

in Bintulu, and our staffs enjoy many opportunities to engage with the

citizens. Over the years, we have built up a strong relationship with the

local community through annual activities like sporting events, festive

celebrations, scholarships school-based tutorial and motivational

camps, health, safety and environmental programmes.

MARKET

In 2005, Malaysia LNG exported 21.85 million ton of LNG. LNG

is exported through Bintulu port ex-ship (for all term Japanese sales)

and FOB (for some Korean volumes) on various sized ships. Malaysia

Dua has agreed a sale ex-ship to Sendai City Gas and Saibu Gas using

small ships. These vessels of 18,928 cu.m. can cause some operational

problems as they are relatively slow in loading and occupy one of the

berths at Bintulu that is also used for larger ships.

MLNG Japan buys 65% of Malaysian LNG, and this represented

22% of Japan’s LNG requirements in 2005. Other importers are Korea

(26%) and Taiwan (9%). In addition to the export on a long-term basis,

MLNG also sells LNG on the spot market to the Asia region and the

Atlantic Basin.2

2 http://en.wikipedia.org/wiki/Malaysia_LNG

ISSUE

COMMUNICATION

i. Investing in Education

Under the MLNG Minor Scholarship programme, MLNG is sponsoring

the underprivileged children to pursue their secondary school

education. We believe that education initiatives such as this one are an

investment into the future of company and our country.

ii. Focus Areas

a. Education

MLNG Minor Scholarship Award Scheme

- Cybercamp For Schools

- Program Bakti Pendidikan PETRONAS

- Motivational Camps For Schools (Kem Motivasi)

b. HSE

HSE Awareness Programme

c. Sports

- Liga Bolasepak PETRONAS

- PETRONAS Golf

- Inter-School Sports

d. Social

- Activities in support of festive occasions such as Majlis

Berbuka Puasa, Pre-Gawai, and Program Sentuhan Kasih