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News that glass wool products manufacturer Poly-Glass Fibre (M) Bhd may reconsider its plans to implement a RM150mil expansion exercise in Penang if it fails to obtain a long-term supply of natural gas from Gas Malaysia Sdn Bhd once again brings into sharp focus the energy issues facing the glass issues of South East Asia.
Group managing director Chow Hon Piew said that Gas Malaysia had approved an additional allocation of 400,000 million British thermal units (mmbtu) per year of natural gas over this year and next.
“The two-year commitment is not sufficient as we are making a RM150mil investment to expand.What will happen after that?”
Chow said the use of electricity would result in the company incurring substantial energy costs.
For the investment to be viable in the country, we need Gas Malaysia to commit a 20-year supply of natural gas to us,” he said, adding that negotiations with Gas Malaysia to obtain at least a 20-year supply were still on.
He said the company would look to other markets like Indonesia if it could not strike a deal with Gas Malaysia.
The group currently uses 70,000 mmbtu of natural to produce 8,000 tonnes of glass wool products per year.
Glass wool, made from recycled glass, is used in commercial and residential buildings to insulate them from heat as well as to reduce energy consumption.
Our present supply contract, which is subject to renewal, is valid till December 2012, ” Chow said.
Poly-Glass’s expansion plans include establishing 10 sales offices in the peninsula and east Malaysia, creating some 1,000 new job opportunities. “We also plan to set up 10 sales offices in Asean countries,” he said.
Chow said the company had already reached its maximum production capacity, operating on full shifts.
We are now producing 660 tonnes of glass wool monthly with an estimated value of RM3mil. For this, we use 5,500 mmbtu of natural gas,” he said, adding that the company planned to raise glass wool output to 2,000 tonnes per month.
As the industry descends on Singapore for the much-awaited Glasstech Asia show, surely there is no better time to bring this contentious, limiting issue to the fore?
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