Malaysia Balances LNG Exports and Imports Amid Rising Domestic Demand

Petronas plans to expand its LNG exports to Asia while supporting Malaysia's rising energy needs. The state-owned company will meet overseas demand for gas and explore new markets in Southeast Asia. However, Malaysia is also eyeing more imports due to dwindling domestic reserves and growing energy requirements driven by a data center boom. Petronas will continue to explore for more resources and bring in imports to sustain domestic production.

Malaysia's state energy firm, Petronas, has announced plans to significantly expand its liquefied natural gas (LNG) exports to Asia while addressing the country's growing energy demands. The company aims to meet overseas demand for gas and explore new markets in Southeast Asia, including Vietnam and the Philippines [2].

Petronas' diversified portfolio, which includes a newly operational export plant in Canada, will enable it to meet both domestic and international gas requirements. However, the country is also facing dwindling domestic reserves and an increasing demand for energy driven by a data center boom. Malaysia imported about 3.3 million metric tons of LNG in 2024, up from 2.1 million tons in 2021, indicating a growing reliance on imports [2].

In response, Petronas will continue to explore for new resources and bring in imports to sustain domestic production. The company has already started reviewing its operations to mitigate the impact of lower crude oil prices and is considering partnering with other firms to reduce risk exposure, especially for high-capital investment projects [1].

Petronas is also considering expanding its presence in Canada, given the country's significance as a major liquefied natural gas supplier. In July, Petronas delivered its first LNG cargo to Japan from its newly operational LNG facility in Kitimat [1].

Traditional gas suppliers in Asia are being forced to rethink their export strategies as they try to reconcile rapid economic growth with falling domestic reserves. Malaysia, once a heavy producer, is now increasingly dependent on LNG imports, with plans to buy $3.4 billion of US LNG annually to secure a lower tariff from Washington [2].

In a broader context, the trend of once-heavy producers turning to imports highlights the global shift in energy dynamics. As countries like Malaysia seek to balance their energy needs with environmental concerns, the role of blended finance deals becomes increasingly important. Global Infrastructure Partners LP, a unit of BlackRock Inc., is setting up a team to finance such infrastructure projects in Southeast Asia, supporting the region's transition towards cleaner energy [3].

References:
[1] https://www.businesstimes.com.sg/international/asean/malaysias-petronas-boost-international-portfolio-60-over-next-decade
[2] https://www.bloomberg.com/news/articles/2025-08-12/petronas-to-expand-lng-exports-despite-rising-domestic-demand
[3] https://www.bloomberg.com/news/articles/2025-08-07/blackrock-s-gip-said-to-hire-for-southeast-asia-infrastructure