KUALA LUMPUR – The Court of Appeal yesterday ordered Shell MDS (Malaysia) Sdn. Bhd. to settle gas supply payments estimated at more than RM500 million to Petroliam Nasional Berhad (Petronas), involving facilities in Bintulu, Sarawak, since August last year.
This follows Petronas successfully setting aside an interim injunction issued by the High Court on January 29, which required the national oil company to continue supplying gas to Shell MDS without any payment.
The payment relates to gas supply valued at RM80 million per month since August last year.
Shell MDS had withheld payments related to two invoices – one from Petronas and the other from Petroleum Sarawak Bhd (Petros) – due to concerns over possible double payment while the jurisdictional issue between Petronas and Petros was being resolved.
A three-judge panel led by Datuk Azimah Omar, sitting with Datuk Wong Kian Kheong and Datuk Ismail Brahim, ordered Shell to make payment within 14 days from yesterday, according to Malaysia Gazette.
Payments are also to be calculated starting yesterday until October 5 and deposited the following day.
Petronas also succeeded in setting aside two other injunctions related to Bank Guarantees.
During proceedings, Petronas was represented by lawyers Datuk Cyrus V Das, Khoo Guan Huat and Datuk Azian Mohd. Aziz, while Shell MDS was represented by Christopher Leong and Janet Chai Pei Ying. Logan Sabapathy and Foo Joon Liang appeared for Petros as an intervener.
Previously, Shell MDS had sought an injunction—granted by High Court Judicial Commissioner Arziah Mohamed Apandi—to suspend payments to Petronas and Petros while ensuring continued gas supply.
On January 29, the High Court granted Shell MDS a temporary injunction that allowed the company to defer payments for natural gas supplies in Bintulu.
Judicial Commissioner Arziah Mohamed Apandi suspended payments to both Petronas and Petros but ensured gas supply would continue.
She noted that Shell MDS faced risks of gas supply disruptions under two competing Gas Sales Agreements (GSAs) with potential financial exposure estimated between RM70 million and RM100 million.
The injunction was granted as Shell MDS was involved in two separate gas supply agreements: one with Petronas (signed July 17, 2020) and another with Petros (signed August 16, 2024).
The court was previously informed that Petronas had suffered losses of more than RM80 million per month due to non-payment since August last year, despite continued gas supply.
Petronas later filed an appeal to set aside the injunction against it. – September 23, 2025
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