Malaysian companies which rely on gas to power their industries have been given a market price adjustment deadline, said Minister in Prime Minister's Department Amirsham Aziz.

At a press conference today, the minister in charge of the Economic Planning Unit said that by 2021 these industries will have to pay full market price for their gas consumption.

Industries and small medium enterprises will be given 11 and 13 years to adjust to market prices.

amirsham abdul aziz Currently the industries are enjoying a 70 percent discount from the market prices, which is said to be around RM79 per Million British Termal Unit (MMMBtu).

But these discounts accrued at the expense of Petroliam Nasional Bhd will be reduced gradually starting from next year until it matches market prices. Gas prices will be revised annually on July 1 until this goal is met.

Industries, which use more than 2 mmscfd, will have to pay RM23.88/MMBtu effective July 1. Industries, which use less than 2 mmscfd, will have to pay RM22.06/MMBtu starting Aug 1.

Previously, they paid RM11.32/MMBtu and RM12.87/MMBtu respectively.

Gas supply to household

During the fuel price hikes announcement on June 4, industries using more than 2 mmscfd were expected to pay RM32.56/MMBtu.

However, this quantum was reduced after the Economic Planning Unit heard representations from the affected parties, said Amirsham.

Besides industries, also affected are some 8,887 households which subscribe to direct gas supply.

Under the revision, they will now pay the same rate as other liquefied petroleum gas users. They will now have to pay RM26.80/MMBtu instead of RM19.72/MMBtu.

According to Amirsham, the new revision is in line with the government's policy to eradicate gas subsidies.

"Furthermore, this gradual reduction will encourage our industries to be more efficient and rely less on cheap gas," the minister added.

The revision today does not include the supply of gas to the electricity producers, priced presently at RM14.31/MMBtu.

When asked if the authorities were considering a revision of the Windfall Profit Levy on independent power producers, Amirsham said that was in the hands of Second Finance Minister Nor Yakcop.

The rates above are for Peninsular Malaysia only as the department is working on another scheme for East Malaysians.

"The number of industries in East Malaysia are neglible," said Amirsham.