1. INTRODUCTION
Dialog Group Berhad (“DIALOG”) is pleased to announce the next phase of expansion at its terminals in Tanjung Langsat, Johor Darul Ta’zim, Malaysia, comprising an additional 100,000 m3 of storage capacity for petroleum products (“the Expansion”). The Expansion is expected to be completed by mid-2029 and upon completion, will increase DIALOG’s total combined storage capacity in Tanjung Langsat to over 1.1 million m3.
Dialog Terminals Langsat (3) Sdn. Bhd. (“DTL3”), DIALOG’s indirect wholly owned subsidiary, marked DIALOG’s first foray into storage facilities for sustainable and renewable fuel products, with an initial storage capacity of approximately 24,000 m3 connected to truck loading bays and existing marine facilities.
Building on this initial capacity, in September 2026, DTL3 successfully completed and commenced commercial operations of an additional 150,000 m3 of storage capacity for renewable and petroleum products, including Sustainable Aviation Fuel (“SAF”) and Hydrotreated Vegetable Oils (“HVO”). The entire 150,000 m3 capacity has been fully contracted, including 100,000 m3 dedicated to EcoCeres Limited under a take-or-pay storage agreement. This additional capacity, together with the latest Expansion, reflects DIALOG’s continued development of its storage infrastructure in Tanjung Langsat.
Today, DIALOG is the second-largest terminal owner-operator in the region, with an operating storage capacity of 5.5 million m3. DIALOG will continue to invest in phased capacity expansions across our terminals portfolio, in line with the Group’s strategy of growing sustainable and recurring income streams.
Rationale and Prospects
Against the backdrop of growing energy demand in Asia, DIALOG continues to expand its terminal operations to cater for such growth opportunities while complementing its existing storage of petroleum and petrochemical products.
Terminals play a pivotal role in the transport and logistics of energy market, facilitating the storage and handling of petroleum and petrochemicals related products, while retaining their traditional role as the gateway to energy trading. Potential users include biofuel production companies, energy trading houses, multinational energy companies and others.
The strengthening of the midstream capabilities will lead to an increase in DIALOG’s sources of sustainable and recurring income in the future and reinforces DIALOG’s position as a leading integrated technical services provider. In line with this, DIALOG’s engineering, procurement, construction and commissioning (“EPCC”) division will execute the relevant works for the Expansion.
DIALOG will remain focused and steadfast in the pursuit of diversification across the upstream, midstream and downstream energy sector as well as the sustainable and renewable sector, to strategically position the Group to participate and benefit from different economic and oil price cycles, which is in line with the Group’s strategy of generating long term recurring income.
2. DETAILS OF THE EXPANSION
2.1 SCOPE OF WORK
DIALOG will undertake the engineering, procurement and construction (“EPCC”) of the storage facilities for petroleum and petrochemicals related products with a storage capacity of 100,000 m3 connected to existing marine facilities.
2.2 THE EPCC PERIOD
The EPCC works for the Expansion will commence immediately and is expected to be completed by mid-2029.
2.3 INFORMATION ON DTL3
DTL3 is an operating terminal with storage capacity of approximately 380,000 m3 serving short to medium term energy traders and multinational companies storing energy products. It is located adjacent to two other terminals i.e. DIALOG Terminals Langsat (1) Sdn. Bhd. (“DTL1”) and DIALOG Terminals Langsat (2) Sdn. Bhd. (“DTL2”). Upon completion of the Expansion, the combined storage capacity of DTL1, DTL2 and DTL3 will surpass 1.1 million m3.
3. FINANCIAL EFFECTS
The Expansion is not expected to have any effects on the share capital and substantial shareholders’ shareholding of DIALOG and is not expected to have any material effects on the earnings, net assets and gearing of DIALOG for the current financial year ending 30 June 2027. However, it is expected to contribute positively to the future earnings of DIALOG group.
4. RISKS
Risk factors affecting the Expansion include, but are not limited to execution risks, such as availability of skilled manpower, technical expertise and materials, changes in prices of materials, changes in economic and regulatory conditions, and health, safety and environment (“HSE”) considerations. Nevertheless, DIALOG will undertake all the necessary efforts to mitigate the various risk factors identified.
5. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS’ AND PERSONS CONNECTED WITH THEM
In so far as the directors of DIALOG are able to ascertain, none of the directors of DIALOG, major shareholders of DIALOG and/or persons connected with them have any interest, whether direct or indirect, in the Expansion.