As the Malaysia’s Ministry of Economy races to table a new carbon capture, utilisation and storage (CCUS) bill by year-end, the country’s environment minister has acknowledged criticism of the technology as a risky climate mitigation tool.
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“I understand and share that there are real concerns about the risks and challenges of CCUS,” Nik Nazmi Nik Ahmad, Minister of Natural Resources and Environmental Sustainability (NRES) told Eco-Business in an exclusive interview. “But if you read [the work of] experts who are involved in climate change, a lot of them say that you cannot rule out CCUS as one of the levers for decarbonisation.”
CCUS, which is the process of capturing and storing carbon dioxide that would otherwise be released into the atmosphere, is being touted by the government as a way for Malaysia to show regional leadership in decarbonisation.
However, the technology has drawn significant flak from environmental advocates in Malaysia and abroad. In August, environmental non-profit Sahabat Alam Malaysia (SAM) said that CCUS projects have historically overpromised and under-delivered on pledged decarbonisation, and have instead prolonged the use of fossil fuels.
Along with other civil society groups such as Greenpeace Malaysia, RimbaWatch and Klima Action Malaysia, SAM has called on the Malaysian government to stop approving CCUS projects. A statement from the groups cited United Nations secretary general Antonio Guterres, who has described the use of carbon capture as greenwashing by the fossil fuel industry.
However, given the urgent need to address climate change and Malaysia’s commitment to net zero emissions by 2050, every potential decarbonisation solution should be considered, said Nik Nazmi. “If you can press all the buttons and say, four out of six work, then maybe we stand a chance [to reach net zero by 2050],” he said.
Still, the Malaysian government, businesses and civil society must be fully aware of the risks of CCUS, including the potential for leaks and corrosion during the process of capturing and storing carbon dioxide. “We have to go in [on CCUS] with our eyes wide open. We cannot accept it point blank,” he said.
The CCUS bill is spearheaded by the Ministry of Economy, helmed by Rafizi Ramli but the Department of Environment, which reports to NRES, has been consulted on environmental and climate-related aspects, said Nik Nazmi.
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We have to be very careful. [Carbon capture and storage] should be about reducing the risk of climate change, not making it worse.
Nik Nazmi Nik Ahmad, Minister of Natural Resources and Environmental Sustinability, Malaysia
‘Meaningful public consultation’ needed
In a speech on Thursday, Rafizi said that he is hoping to get Malaysia’s CCUS bill passed at a “record speed of six months” – ahead even of the national climate change bill that NRES plans to table in early 2025 and which has taken over two years to develop.
“Without CCUS, power plants and steel industries will just not meet their [emissions] targets – it’s a reality that we have to accept,” said Rafizi at the International Greentech Exhibition Malaysia (iGEM) 2024. The bill, he added, has been benchmarked against best practices from Europe and has incorporated internationally recognised standards.
“We’re going to pass it next month, insya Allah (God willing),” said Rafizi.
But the speed at which the CCUS bill is being pushed through has worried civil society in Malaysia. The Center to Combat Corruption and Cronyism (C4), an independent policy advocacy group, said it was “extremely concerned” by the government’s rapid acceptance of CCUS technology in light of the high social, environmental and financial risks of failure. C4 has demanded “meaningful public consultation with academia and civil society” in the government’s development of the CCUS bill.
Channel checks by Eco-Business found that the Ministry of Economy has held consultations with industry and civil society groups, but the details of the bill have not been shared yet. By contrast, a draft of the national climate change bill was recently made public for feedback.
However, the Ministry of Economy on Friday launched a public survey to gauge the understanding and perception of Malaysians towards CCUS. The survey includes questions about individual awareness of climate change and CCUS, as well a page explaining how CCUS works as a decarbonisation method. [see box]
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Can Malaysia benefit from CCUS?
The Ministry of Economy’s survey on the Malaysian public’s perception of carbon capture, utilisation and storage (CCUS) has over 25 questions. A key page introduces CCUS, and then asks whether the respondent agrees or disagrees that CCUS should be deployed in Malaysia, and why. The text of this page is below:
CO2 emissions, which contribute significantly to climate change need to be mitigated. CCUS is one of the decarbonisation methods that would be able to physically reduce large volume of CO2 emissions. The process involves three main steps:
1. Capture: CO2 is captured from sources like power plants and industrial facilities before it can be released into the atmosphere.
2. Utilisation: The captured CO2 can be repurposed for various industrial applications, such as in the production of chemicals, building materials, and enhanced oil recovery.
3. Storage: CO2 is stored securely in geological formations, such as depleted oil and gas fields or deep saline aquifers, to prevent its release into the atmosphere.
Why is CCUS important for Malaysia?
• Environmental impact: By reducing CO2 emissions, CCUS helps mitigate the effects of climate change and improves air quality.
• Economic benefits: CCUS can create new job opportunities, stimulate economic growth, and attract investments in new technologies.
• Energy security: It supports Malaysia’s transition to a low-carbon economy while still utilising its existing industrial infrastructure.
The Malaysian government is exploring CCUS as part of its broader strategy and to meet international climate commitments. Public awareness and acceptance of CCUS are crucial for its successful implementation and for Malaysia to fully benefit from this technology.
Source: MyCCUS Public Perception Questionnaire
When asked if the results of the survey would have any impact on the CCUS bill, a spokesperson from the Ministry of Economy told Eco-Business that the results would help the government understand the awareness level of all stakeholders.
“[The findings] may be used to create more effective engagement plans to raise awareness [about CCUS],” the spokesperson said.
Commercial motivations
Various CCUS sites have already been identified in Malaysian waters, largely in oil and gas reservoirs that are either depleted or currently being mined. Malaysia’s national oil company Petronas is leading the majority of these developments, including the flagship Kasawari carbon capture and storage (CCS) project, off the coast of Sarawak. Slated for completion by end-2025, the Kasawari project is currently the largest of its kind in Southeast Asia and will be able to store 3.8 million tonnes of CO2 annually.
Malaysia’s relative geological stability and abundance of oil and gas reserves has made it an attractive destination for potential CCUS sites. Unlike neighbouring Indonesia, it is located outside the Ring of Fire, a region of active volcanoes and frequent earthquakes.
Despite this, Nik Nazmi pointed out that Indonesia has been faster to develop a legal framework allowing for CCUS development, having passed a presidential decree in March that will act as an umbrella regulation for CCUS projects in the country.
“I think if Malaysia does not explore [CCUS] for ourselves, then I think we are wasting an opportunity,” Nik Nazmi told Eco-Business. Countries including Japan, South Korea and Singapore have expressed significant interest in developing CCUS sites in Malaysia, with Japanese entities having already signed agreements with Petronas to study a cross-border carbon capture and storage value chain.
Malaysia’s Minister for Natural Resources and Envrionmental Sustainability, Nik Nazmi Nik Ahmad (right) spoke to Eco-Business regional correspondent Samantha Ho about his ministry’s involvement in the carbon capture, utilisation and storage bill. Image: Jason Tan/ Eco-Business
Going forward, further memoranda of understanding will be signed with some of these countries to facilitate transboundary CCUS activities, said Rafizi. “This is the most important step that can allow us to build a global supply chain which supports climate and net zero commitments and [allows the] shipping and transportation of liquified CO2 across boundaries,” he said.
In fact, countries like Japan are looking to Malaysia to “take the lead” on decarbonisation, said Rafizi, citing his engagements with other economic and energy ministers in Asia via the Japan-led Zero Emissions Community (AZEC) initiative. The initiative has been criticised in Indonesia and by international organisations for prolonging fossil fuel use.
Nik Nazmi told Eco-Business that regulations surrounding CCUS will have to be “very strict” to ensure that Malaysia is not increasing the risk of greenhouse gas emissions and climate change.
“We have to be very careful. It should be about reducing the risk of climate change, not making it worse,” he said.
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