Minnikhanov: ‘Tatarstan is ready to contribute to the development of Russian-Malaysian links’

Minnikhanov: “Malaysia is Russia’s reliable partner”

Tatarstan Rais Rustam Minnikhanov and Vice Prime Minister and Minister of Industry and Trade of Tatarstan Oleg Korobchenko welcomed the delegation of Maharani Energy Gateway on the 7 March afternoon. Director General of TAIF JSC Albert Shigabutdinov attended the meeting too.

“It is important that Russian-Malaysian relations are maintained at top level on a regular basis. Malaysia is a reliable trade partner of Russia. We are thankful to the administration of our countries for the creation of favourable conditions to expand the interregional cooperation,” Rustam Minnikhanov stressed in his welcome speech and added, “Tatarstan, in turn, is ready to contribute to the development of business links. I always visit your amazing country with great joy and interest.”

In particular, Rustam Minnikhanov has been in the Johor Sultanate twice and had the honour of being received by Sultan Ibrahim Ismail Ibni Almarhum Sultan Iskandar Al-Haj — the sultan of Johor and future king of Malaysia. And as the Tatarstan rais stressed, that talk was very insightful and productive.

The sides expect the possible visit of the sultan to Kazan this May to be no less productive. The Tatarstan capital will welcome participants in the Russia — Islamic World: KazanForum International Economic Forum. Last year, it gathered 32 diplomatic missions, and in 2023 it promises to be larger because according to Russia’s President Vladimir Putin’s decision it was defined as a nationwide event.

Rustam Minnikhanov also highlighted that Russia had been establishing close links with Islamic countries in all areas for many years. And Tatarstan plays a noticeable role in these processes, while according to the country’s leader’s decision Rais of the republic Rustam Minnikhanov chairs the Russia — Islamic World Strategic Vision Group.

Also, Rustam Minnikhanov reminded the audience that Russia joined the Organisation of Islamic Cooperation as observer 20 years ago during Vladimir Putin’s visit to Malaysia.

“Within this milestone, the 20^th jubilee since the moment when Russia became an observer of the Organisation of Islamic Cooperation, we plan to hold one of the meetings of the group in Malaysia this year. We are discussing this issue together with the administration of your country, the new prime minister and I am sure that everything must be fine,” the Tatarstan rais announced the event.

During the talk with the Malaysian delegation, Rustam Minnikhanov also noted the commercial and economic activity between Russia and Asian countries, including in energy resources, growing year after year.

“We were informed that you chair a large energy company that stores, transports, sells, sets up logistics in the oil and gas sector. I am sure that there are good opportunities for cooperation with your in these areas of work,” Rustam Minnikhanov emphasised at the end of the meeting.

TAIF was the first to be offered partnership

A few hours before the talk in the Kazan Kremlin, the delegation of Maharani Energy Gateway managers visited a new business centre of TAIF JSC on 80, Pushkin Street. The meeting was organised with the help of the management of Tatarstan Trading House and personally its Director General Ramil Mavlyutov.

On behalf of TAIF Group and SIBUR holding shareholders, Director General of TAIF JSC Albert Shigabutdinov welcomed the guests. He told them about recent large-scale transformations, strong financial, economic and production performance last year and plans for the foreseeable future:

“We underwent serious changes in 2021: we united the energy and petrochemical complexes with SIBUR. TAIF shareholders joined the composition of SIBUR shareholders. TAIF continues its activity in oil and gas processing, construction, construction materials, investment and financial area. More than $17 billion of total revenue is the results of 2021. Also, a development programme of the petrochemical sector through 2035 for over $20 billion was designed and is successfully implemented together with SIBUR. Its value is $5 billion.”

Maharani Energy Gateway’s Executive Chairman Daing A Malek Daing A Rahaman chaired the delegation from Malaysia. The sides introduced other attendees of the meeting — the top management and heads of areas of both companies’ activity.

The guests watched a film about the composition and areas of TAIF Group’s activity with great interest. A moment about successes of the unique Heavy Residues High Conversion Facility with the recovery of up to 98% of high-quality light petrochemicals per tonne of feedstock caused the biggest revival.

After the presentation of the sides, Mr Rahaman voiced the main goal of their visit to Tatarstan noting that precisely Kazan and TAIF JSC were the first they were holding talks with in Russia.

Mr Rahaman said they were glad to welcome them on behalf of Maharani Energy Gateway and thanked for the organisation of the meeting and hospitality, the opportunity of telling them about their project Maharani Energy Gateway. So according to him, the main goal of the visit was to get acquainted, see what possibilities Tatarstan had to develop Maharani Energy Gateway’s hub in the Johor Province. He stressed at the beginning that the project’s possibilities could significantly help companies from Tatarstan to promote products and increase supplies to Asian markets, said Mr Rahaman.

The initiators of the project think the huge hub that is planned to be created by the seaside of one of the most vivid sea routes — the Malacca Strait — in the next few years can become one of the most successful commercial projects. Three manmade islands at the crossroads of logistic routes that more than 100,000 cargo ships cross, mostly oil tankers and ships carrying LNG is going to be erected.

The smallest island, of some 80ha, is planned to be used for facilities providing technical maintenance and modernisation of tankers. The second one, 600ha, will be a congregation of oil warehouses, liquefied natural gas and light petrochemicals.

40 million barrels, or about 5.5 million tonnes, can be stored at the same time. The third one, 600ha too, will be a full-cycle oil and gas processing cluster — from oil refineries to petrochemical factories and end product shipping portals. The annual feedstock capacity of the cluster will be measured in tens of millions of tonnes. Up to 300,000 bpd of oil alone is considered to be refined.

Everything, including another area — floating reloading station for sea oil and LNG tankers — are planned to be united within the deepest sea port in the region, from 24 metres in depth. The total cost of the project will be some $40 billion.

The guests invited companies from Tatarstan to participate in this project, invest in it. They also intended to offer oil and gas companies from Tatarstan to cooperate. They are convinced that this cooperation would benefit the economy of the whole region and it could expand its footprint in the oil and gas sector.

Demand for energy is already huge and will only grow

Statistically, cargo traffic through the Malacca Strait grows year after year. Vice Executive Chair of Maharani Energy Gateway Siow Yok Fung joined the conversation. She says that 19 million barrels of energy — oil and gas — are daily carried through the strait Maharani Energy Gateway is located in. Before the pandemic, the amount was smaller — 16.5 million bpd. Their Chinese partners say that the Malacca Strait is the key point of commercial routes. 960 million metric tonnes of oil passed through it last year alone. So they expect the volumes to increase to 30 million bpd by 2025. If we have a look at logistic routes, this place is crucial to enter the Asian market.

A part of the freight is reloaded with the help of specialists and equipment of Maharani directly in the sea and is shipped further. But many companies and entire countries are interesting in longer storage and raw hydrocarbon processing as well as the expansion of possibilities of buying finished products, products of oil and gas processing, petrochemicals. The capacities of deep sea ports in Singapore, mainland China and Hong Kong are not enough anymore. More storage facilities, oil refineries, gas and petrochemical factories and products made by them are needed.

Maharani Energy Gateway’s founders intend to provide such an opportunity. The Johor sultan became one of the initiators and the major shareholder of the project.

Mrs Fung talked about components of the project. Maharani Energy Gateway will be the owner and operator of the port. The territory for this project was already allocated — near the strait. The land will be owned by Maharani Energy Gateway. So it turns out to be a mixed port town: both in the sea and on land. They want to take advantage of this opportunity to get a big share of the Asian market and to have key suppliers not only from Gulf countries. What are the advantages of Maharani Energy Gateway? It is a free port, tax-free zone, all permits of the project were already obtained. Infrastructural issues are resolved. They have a proposal from Russian company when it comes to energy. It is a long list of business opportunities. Today they need competencies: experience to set up the activity that will be run on the land, Mrs Fung specified.

Moreover, in the projects related to the construction and use of storage facilities and oil and gas processing enterprises, the company will be fine with the role of a minority shareholder and land lesser to implement projects.

The TAIF management was interested in applied moments. Particularly, they wondered if there was obtained an environmental permit for the project any factory cannot be built without, how thoroughly the project was elaborated in each of the three islands and if components of oil refineries are already known, what products were expected from gas and petrochemical enterprises, if Maharani Energy Gateway’s initiators themselves were ready to invest in some project components on equal terms.

They visited Tatarstan first for a reason

Maharani Energy Gateway Executive Director Muhammad Razif Bin Ahmad told journalists about this later in an interview.

According to him, during the discussion of the trip, they considered their knowledge about Tatarstan. Tatarstan Trading House and personally Mr Mavlyutov played a big role here. They managed to arrange a meeting thanks to him. And what they saw in the presentation that day allowed them to understand that the decision was correct: TAIF had extensive experience in building facilities the project needs as well as rich experience in technologies. They believe the totality of such components will have an effect, he noted.

So after this, in fact, preliminary meeting, the sides discussed the possibility of signing a series of documents on further mutually beneficial cooperation.

At the end of the meeting, the sides exchanged memorable — as a token of good relations and possible cooperation.