Global energy giants are targeting the Southeast Asian market! Aiming for more natural gas exploration

Currently, global energy giants are heavily investing in natural gas exploration and production in Malaysia and Indonesia to meet the region's growing electricity demand. This is driven by the increasing population and the surge in data centers in Southeast Asia.

As countries embark on different energy transition paths, Southeast Asia is viewing natural gas and liquefied natural gas (LNG) as fuels to replace coal and reduce emissions in the region. As energy giants turn their attention to Southeast Asia, governments in the region also hope to provide more affordable local natural gas supplies to drive economic growth and improve energy security.

Daniel Yergin, Vice Chairman of S&P Global, commented that natural gas now holds a much higher position than it did a few years ago. "If natural gas does not play a larger role, countries will not be able to provide the electricity needed for economic growth and data centers."

Investment Influx

Malaysian Prime Minister Anwar Ibrahim announced on Tuesday that at the Asia Energy Conference held in Kuala Lumpur this week, Shell committed to increasing its investment in Malaysia by 9 billion ringgit (equivalent to $2.12 billion) over the next two to three years.

Shell CEO Wael Sawan also pointed out at the conference, "From now until 2035, natural gas production in Southeast Asia is expected to decline by about 20%, and this gap in production needs to be filled."

On Monday, French energy giant TotalEnergies further acquired shares in Malaysian natural gas assets from Petronas. Shell CEO Patrick Pouyanne said, "I would say this is where the population is growing. So this is where we need more energy."

Italian oil major Eni and Petronas are advancing plans to form a joint venture to develop natural gas assets in Indonesia and Malaysia, with the agreement expected to be signed by the end of this year.

Takayuki Ueda, CEO of Japan's top exploration company Inpex, said that the company has returned to Malaysia and is conducting resource exploration in six blocks in Sarawak, Malaysia, while also developing the Abadi LNG project in Indonesia.

Ueda added, "The demand for natural gas, particularly LNG, will actually increase for a longer period beyond 2040, possibly until 2050. Given the current highly uncertain and unpredictable geopolitical situation, one of our strategies now is to produce locally for local consumption."

Ryan Lance, CEO of ConocoPhillips, also told local media that the company plans to invest in Sabah.

Tengku Muhammad Taufik Tengku Aziz, CEO of Petronas, stated that the company is working hard to meet the soaring power demand of data centers, with global power demand for data centers expected to more than double to 945 terawatt-hours by 2030.

He also pointed out, "The entire energy system we manage is now striving to meet this soaring demand."