Shell Energy Malaysia and PGB to Study Biomethane Injection Into PGU Pipeline

Shell Energy Malaysia and PETRONAS Gas Berhad (PGB) have signed a Joint Study and Collaboration Agreement (JSCA) to explore opportunities for injecting biomethane into the Peninsular Gas Utilisation (PGU) pipeline network. The companies describe the agreement as an important step supporting Malaysia's energy transition, aimed at exploring scalable ways to bring biomethane to customers.

What the Study Will Actually Assess

Over the coming months, Shell and PGB will assess the technical and commercial feasibility of injecting biomethane into the PGU network specifically, combining PGB's expertise in gas infrastructure and pipeline operations with Shell's biomethane experience. The stated goal is identifying practical pathways for integrating biomethane into existing gas infrastructure and delivering renewable gas to customers at scale, rather than building new, standalone biomethane distribution infrastructure from scratch.

Why the PGU Network Specifically

The Peninsular Gas Utilisation network is Malaysia's longest pipeline, spanning roughly 2,623 kilometres and transporting gas to power generators, petrochemical plants and industrial customers across Peninsular Malaysia, including exports to Singapore, through entry points at Kertih, Pengerang, Sungai Udang and the Thailand border. Built in phases between 1984 and 2001, it is owned and operated by PGB on behalf of parent company PETRONAS. A pipeline of this scale and reach is what makes biomethane injection potentially attractive: gas entering the network at any point could theoretically reach the full range of existing industrial and power-sector customers already connected to it, without each customer needing separate new biomethane-specific infrastructure.

Consistent With a Broader Shell-PETRONAS Collaboration Pattern

This is not the first joint study agreement between the two groups. Sarawak Shell Berhad and PETRONAS signed a separate JSCA in January 2022 to jointly study carbon capture and storage opportunities and suitable CO2 storage locations in Malaysia, aimed at building carbon-resilient upstream portfolios for both companies. That earlier agreement, on a different technology, established a template of joint feasibility studies between the two companies preceding any binding commercial commitment, a structure this new biomethane agreement follows.

What This Announcement Does, and Does Not, Confirm

This is a feasibility study agreement, not a commercial supply contract or a confirmed injection project. No timeline for completing the study, target injection volumes, specific PGU entry points under consideration, or investment figures have been disclosed. Independent, third-party news coverage of this specific agreement could not be located at time of writing; the details here are drawn from the companies' own announcement.

Source: Shell Energy Malaysia, 21 August 2026.