(Corrects ringgit and dollar units in paragraph 5 of June 4 story to billion from million)
KUALA LUMPUR, June 4 (Reuters) - Malaysia's state oil firm Petronas has approved plans to build a floating liquefied natural gas (LNG) plant offshore Malaysia and aims to bring it online in 2015, which, if it were successful, would make it the first such plant in the world.
Petronas' main competitor in the race to bring the first floating LNG plant online is oil major Royal Dutch Shell which approved its Prelude LNG floating plant last year and has said it intends to bring the plant online by 2017.
The floating LNG plant will allow Petronas to drill and ship gas from fields that were either too small or too remote to be profitable previously, CEO Shamsul Azhar Abbas said at a gas industry gathering in Kuala Lumpur on Monday.
"This is an example where advancement of technology has made it economically feasible to monetise stranded gas in small and scattered conventional fields," Shamsul said of the project.
Petronas is facing diminishing oil and gas reserves in Malaysia and plans to spend 300 billion ringgit ( $93.79 billion)over the next five years to step up its deep-water exploration activities as well as re-exploring marginal fields.
In 2011, Malaysia was the world's second largest exporter of LNG, according to Petronas and the world's 15th largest gas producer. But declining reserves in Malaysia are forcing the country to import the fuel as well.
Malaysia's first LNG import terminal in Melaka, Malaysia, is due to start up in July 2012.
"The intent is to prepare for the impending shortfall of supply in peninsular Malaysia. We are also assessing the feasibility of constructing a second LNG re-gasification terminal," Shamsul said.
The second terminal would be in southern Johor, and a third terminal in Lahad Datu in east Malaysia is set to be commissioned in 2015, he added. ($1 = 3.1985 Malaysian ringgits) (Reporting by Rebekah Kebede and Charlie Zhu; additional reporting by Niluksi Koswanage; Editing by Himani Sarkar)