LABUAN: Rancha Power Sdn Bhd on Tuesday marked a major milestone in Labuan’s energy development with the groundbreaking of a new 120-megawatt (MW) gas-fired power plant, strengthening the island’s electricity capacity and ensuring a stable and reliable power supply.
The groundbreaking ceremony was officiated by Deputy Prime Minister Datuk Seri Fadillah Yusof, who is also Energy Transition and Water Transformation Minister.
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In a statement issued by Petroliam Nasional Bhd (Petronas), Fadillah said the project is important to safeguard Labuan’s electricity supply.
“Designed for flexible generation with an adequate reserve margin, the plant will deliver a reliable supply to meet residential, commercial and industrial demand across the island,” he said.
Petronas said the power plant would be developed within the Rancha-Rancha Industrial Estate, about 2km from the existing Stesen Janakuasa Patau-Patau, which currently serves as Labuan’s main power source and is scheduled to cease operations by Dec 31, 2027.
“The Rancha power plant will ensure continuity of electricity supply and support Labuan’s future energy needs across residential, commercial, and industrial sectors,” it said.
Meanwhile, Rancha Power Chairman Abdul Aziz Othman said the establishment of the power plant represents a transformative step in strengthening Labuan’s energy resilience and supporting regional development.
“Beyond enhancing energy security, this project will serve as a catalyst for economic growth within the surrounding industrial zone, strengthen state-federal collaboration and accelerate the development of local industry capabilities,” he said at the groundbreaking ceremony.
He said the project further reinforces Rancha Power’s role in advancing Labuan’s energy infrastructure and supporting Malaysia’s broader energy transition agenda, paving the way for a more reliable and future-ready power system for the island.
Rancha Power is a three-party joint venture involving PG Energia Sdn Bhd, a subsidiary of Petronas Gas Bhd, SEC Power Sdn Bhd, a unit of Sabah Energy Corporation Sdn Bhd and Sustainable Power Sdn Bhd, a subsidiary of Sabah Electricity Sdn Bhd.
Construction of the facility is scheduled to begin in February 2026, with commercial operations targeted to commence on Jan 1, 2028.
