MYBiomass Sdn Bhd will consider investing US$200mil to US$300mil (RM638.5mil to RM957.9mil) to set up a bio-refinery plant in Johor using oil palm biomass as feedstock, said Malaysian Industry-Government Group for High Technology (MIGHT) president and chief executive officer Yusoff Sulaiman.
MYBiomass is a special-purpose vehicle (SPV) formed under MIGHT.
“Within the next three months, we hope to get a positive outcome from our oil palm biomass currently undergoing testing and technology adaptation at a pilot plant in Turin, Italy.
“This will determine whether industrial sugar can be produced on a commercial scale from oil palm trunks, empty fruit bunches and fronds,” he told StarBizWeek in an interview recently.
The non-edible industrial sugar, also known as isobutanol, butanediol and ethanol, is high in demand, especially for use in industries such as oleochemicals, paints and chemicals.
Yusoff said that once the intellectual property right was obtained, MYBiomass would proceed with the designing of the plant by the end of this year.
“This will be the world’s first bio-refinery facility producing industrial sugar from oil palm-based biomass,” he added.
To date, Thailand has successfully used tapioca to convert into sugar while Brazil is using corn in the production of ethanol.
Given the highly capital-intensive nature of the proposed venture, Yusoff said MIGHT had collaborated with plantation giants Felda Global Ventures Holdings Bhd (FGVH) and Sime Darby Bhd in its maiden project.
Both FGVH and Sime Darby are taking up 40 per cent stake each in MYBiomass, with MIGHT holding 20 per cent.
“Apart from the convenience of providing ample oil palm biomass feedstock easily obtained from their vast plantations, both FGVH and Sime Darby have the financial strength and strong research and development background to ensure smooth operation of the proposed venture,” he added.
Yusoff said MYBiomass was targeting for the bio-refinery plant to commence production by early 2014.
Its production capacity is pegged at 1.2 million tonnes of industrial sugar per day, using some 60,000 tonnes of oil palm biomass.
Going forward, he said MYBiomass would consider venturing into other biochemicals-related products utilising oil palm biomass initially and later graduating to other biomass sources like timber waste and solid waste.
“Once the proposed bio-refinery plant is proven to be a success, we hope it will become the catalyst to draw more international companies to come here to invest or form joint ventures with local companies to produce high-value biochemicals building blocks using biomass sourced locally,” said Yusoff.
Interestingly, he pointed out that the currently idle biodiesel plants in Malaysia, which had failed to take off for the past five years, could also be converted into biochemical plants.
“All it takes is to undergo 40 per cent conversion in the existing biodiesel plants to transform them into biochemical plants,” he said.
There are now over 20 biodiesel plants in Malaysia with an installed production capacity of 2.6 million tonnes annually.
However, production to-date is stagnant, with very few players in operation. It has become unviable to produce palm-based biodiesel due to the high cost of operation, especially with the main feedstock crude palm oil still trading above RM2,000 per tonne.
Rather than staying in an unproductive situation, Yusoff said biodiesel industry players in Malaysia could now venture into biochemicals as their new lease of life.
