Content2011 - PETRONAS Gas Berhad

CEO’s Business Review
INTRODUCTION
The Company’s perseverance
and appetite for business and
operational excellence in the year
under review have enabled it to live
up to its vision to be “A World Class
Poised For Perennial Growth
The fi nancial year 2010/2011 marks the
27th year of incorporation for PETRONAS
Gas Berhad (PGB), 36 months away from
celebrating its three decades of existence
in serving the nation’s energy needs. The
Company has weathered many challenges
since its inception to become what it is today
– stable, reliable and above all, resilient. After
a year of kaleidoscopic achievements in its
journey of transcending possibilities, PGB
has checked into an era it aspired to be – that
of monumental growth and diversifi cation
within the gas and utilities realm, multiplied
in a quantum more than the Company could
possibly imagine.
With a business platform tucked fi rmly under
its belt, which without doubt has reaffi rmed
its business credentials, the Company is now
raring to translate its current business and
Gas and Utilities Company”
technical portfolio into an era of invigorating
growth. The Company’s perseverance
and appetite for business and operational
excellence in the year under review have
enabled it to live up to its vision to be “A
World Class Gas and Utilities Company”
which was introduced to its shareholders and
public during the previous fi nancial year.
A key element which has enabled the
Company to soar to record heights for the
year under review was when it entered
into an Addendum to the Gas Processing
and Transmission Agreement (GPTA) with
Petroliam Nasional Berhad (PETRONAS). This is
the fourth series of the GPTA (4th Term GPTA)
signed between PGB and its holding company
PETRONAS.
The GPTA entered between PGB and
PETRONAS is for a duration of 20 years effective
from 1 April 1994, whereby PGB provides to
PETRONAS the services of processing and
50 petronas gas berhad (101671-h)
transmission of gas to PETRONAS’ customers
via the Peninsular Gas Utilisation (PGU)
pipeline system. The revised terms maintains
the throughput fee structure, which provides
for a guaranteed income from the Reservation
Charge and Flowrate Charge on incremental
volume above an agreed threshold. As in prior
terms stipulated in the master GPTA and it’s
three preceding Addendums, the Reservation
Charge and Flowrate Charge levels were
determined to ensure recovery of reasonable
capital costs and operating expenses.
The fourth Addendum entails clearer
demarcation of terms and remuneration
structure between processing and
transportation of gas by splitting the GPTA
into two sub-elements – the Gas Processing
Agreement (GPA) and Gas Transportation
Agreement (GTA). These separate subelements
of the GPTA will take the company
through highly interesting times from the
period of 1 April 2010 to 31 March 2014.