Gas for households - LPG for cooking as first step
Transcript of Gas for households - LPG for cooking as first step
© 2013 PETROLIAM NASIONAL BERHAD (PETRONAS)
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Gas for households
- LPG for cooking as first step Ho Sook Wah
Secretary General
Malaysian Gas Association
© PETRONAS 2013 1
Before the 1970s, the main fuel for cooking were charcoal,
wood and kerosene
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Charcoal Wood Kerosene
LPG is derived from oil and gas value chain
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GAS
OIL
Processing
Liquefaction
Refining
Transportation Sector :
Gasoline
Jet Fuel
Diesel
Fuel Oil
Industrial Sector:
Ethylene
MTBE
Methanol
Polyethylene
Propylene
VCM / PVC
Export
Power Sector :
Methane
Diesel
Fuel Oil
Commercial &
Residential Sectors
Petroleum
Products
LPG
Sales Gas
LNG
Petrochemical
Downstream Products Upstream
Exploration,
Development &
Production
Condensates
LPG is a BYPRODUCT
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• LPG is produced as a byproduct of:
– Oil production (via the processing of
associated gas)
– Gas production (via the processing of
non-associated gas—including LNG)
– Refining
• Therefore, LPG is a supply-driven market in which demand must adjust to
match supplies.
• LPG production tends to increase quickly when one or more of the above
industries is expanding quickly.
Benefits of LPG
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• LPG is used to replace other traditional fuels such as wood, charcoal and
kerosene.
• It has complete burn of true blue flame that ensures the heat is spread
across the whole pan.
• Faster cooking reduces gas usage thus making it more economical,
environmentally friendlier and healthier for everyone.
• Burns with cleaner flame without burning pots and pans. Thus making
washing up a breeze.
Technical Specification of LPG
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• Composition of Propane-C3 dan Butane-C4: 30% Propane and 70% Butane
• Physical properties : Colourless and odorless
- (an odorant; ethyl mercaptan was introduced to create smell)
• Density (kg/l) : 0.4149 - 0.5952
• Calorific value (kcal/kg) : 11800
• Vapour Pressure : 6 – 7 bar
• Boiling point of LPG : Propane -42C and Butane -60C
Ethane
Pentane
Nitrogen
Sulphur
Water
PROPANE
29.5%
BUTANE
70%
0.5
%
LPG Cylinders are designed with maximum safety and
easy handling
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LPG comes with 12-14 kg cylinders for household use and 50 kg cylinders for
industries
Cylindrical shape offers easy handling, retrieval and storage
Offers maximum safety in case of leakage as LPG vaporize in the air
There are some potential dangers of LPG
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• LPG is heavier than air – possible explosion if mixture of LPG and air is within
explosive limit and there is an ignition source.
• Suffocation – LPG displacing air, thus lowering the level of oxygen. Use of an
odorant to detect leakage of LPG.
• Incorrect use of LPG can result in explosions, fires, lost of property and most
importantly, loss of lives.
• Do not neglect issues like leaking gas cylinders or tubes, damaged
regulators, incorrect method of storage of LPG cylinders, etc.
A Brief History of LPG in Malaysia
From “Fuel for the Elite” To “Fuel for the Masses”
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Prior to 1980s 1980s-1990s 2000s- current
Agricultural-based
economy with low
per capita income.
Cooking uses
traditional fuels-
charcoal, kerosene
etc.
LPG production
from refineries is
mainly for export
market; domestic
demand limited
IOCs (i.e. Shell and
Esso) dominates the
domestic market
Malaysia embarked on industrialization
programme to uplift the economy
PETRONAS entered the LPG business
to solve LPG shortages in Northern
Peninsula
Government introduced APM
mechanism to provide price stability
and ensure sufficient margin to players
PETRONAS embarked on PGU pipeline
and GPP projects to monetize the gas
resources offshore Peninsula
Improved infrastructure - North South
Highway project and enabled greater
transportation of LPG
LPG became the fuel of
choice because of
availability, affordability
and environmental
benefits
PETRONAS achieved 50%
market share
LPG demand took-off as a result of higher standards of
living
© PETRONAS 2013 11
-
20,0
40,0
60,0
80,0
100,0
120,0
0
5000
10000
15000
20000
25000
30000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
GDP Percapita LPG Demand (RHS)
RM Thousand ‘000 bpd
Per-capita GDP vs. LPG Demand
Source: FGE 2013, IMF
To ensure efficient supply, Malaysia has a developed
LPG supply infrastructure
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S A R A W A K
S A B A H
P E N I N S U L A R M A L A Y S I A
Kalimantan
(Indonesia)
Bintulu
South China Sea
Kuala Lumpur
B R U N E I
Pulau Langkawi
Bayan Lepas
Kerte
h
Kuantan
Pasir
Gudang
Melaka
Port Kelang
P. Dickson
Subang
Prai
Senai
Miri
Kuching
Kota Kinabalu
Sandakan
Tawau
Labuan
Sibu
Senai
5
Bottling Plants 9
3
21
Current Capacity (bpd) 557,300 314,300
Refinery
Kertih
LPG Extraction Facility 2
LPG price in Malaysia is heavily subsidized by the
Government for domestic consumers
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Actual price = RM 54.39
Consumer price
= RM 26.60
Subsidy
= RM 27.79
2,73
1,86 1,9
0
0,5
1
1,5
2
2,5
3
Thailand Indonesia Malaysia
Price Breakdown for LPG 14 kg
Regional Price Comparison for LPG RM/kg
Stiff domestic competition have seen the consolidation
of major players over the years
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Previous Current
In summary
Abundant
Supply
Improve standards of living
Infrastruc-
ture
Government
Support
• Availability of oil and gas reserves provide incentives to
utilize indigenous resources
• Rising affluence and living standards shift consumer
preference towards more cleaner fuels
• Well developed infrastructure to carry and transport LPG
to consumers
• LPG is heavily subsidized by the Government for
domestic use.
Key takeaways