KUALA LUMPUR: South Korea’s second largest petroleum refiner, GS Caltex Co, is looking to pump in RM1.2 billion to set up a biobutanol plant in Malaysia, said Agensi Inovasi Malaysia (AIM).
Last week, the South Korean giant signed memoranda of understanding (MoUs) in Sabah and Sarawak to explore prospects of establishing a biobutanol plant in one of those states.
"GS Caltex is looking to finalise their RM1.2 billion investment to build a biobutanol plant by the first quarter of 2017. The central facility’s location will be a choice between Lahad Datu and Tanjung Manis," said AIM chief executive officer Mark Rozario.
AIM, an agency under the Prime Minister's Department, is facilitating the realisation of biobutanol plant proposals in the country.
Biobutanol is a four-carbon alcohol produced by the fermentation of biomass. The process, known as Acetone Butanol Ethanol, uses microbes.
In short, biobutanol is the renewable version of butanol, and can be blended with petrol. Since it is less corrosive and more explosive than ethanol, biobutanol is less susceptible to separation in the presence of water than ethanol.
Tests by the US’ Environmental Protection Agency (EPA) show that biobutanol reduces hydrocarbon, carbon monoxide and nitrogen oxide emissions. Biobutanol also shows promise as an industrial solvent and chemical feedstock.
Rozario was speaking to reporters at a briefing of the International Biomass Conference 2016 held here today.
Also present were Minister of International Trade and Industry Datuk Seri Mustapa Mohamed and Minister in the Prime Minister's Department Datuk Nancy Shukri.
Mustapa concurred with Rozario that the biomass industry in Malaysia presents significant opportunities.
“Bioenergy, biofuels, biochemical and even biomass-based end products like bio-plastics present endless business opportunities for the biomass industry.
"We should be leveraging on these resources to optimise the highest aggregated value these industries can bring to the country,” he said.
The minister went on to reveal that last year, the Malaysian Investment Development Authority (MIDA) approved 40 biomass projects that saw RM724.9 million in investments, more than three times that of 2014's RM230.6 million.
Biomass projects include value-adding on oil palm empty fruit bunches and palm oil mill effluent to produce organic fertiliser, oil palm pellets and peeled palm lumber and fibre.
"In the first half of this year, MIDA had approved 12 biomass projects with investment amounting to RM151.3 million," Mustapa said.