Malaysia’s state of Sabah, the country’s largest palm oil producer, is the site for two separate initiatives building what would be the largest palm-oil biodiesel plants yet.
In December 2005, a joint-venture between state-owned POIC (Palm Oil Industrial Cluster) Sabah Sdn Bhd, Sabah-based Suria Sama Resources Sdn Bhd and South Korea’s Eco Solutions Co. Ltd. announced their plans to build a 300,000 tonnes-per-year plant at the state’s palm oil industrial cluster in Lahad Datu. (Bernama)
With a projected investment of about RM180 million (about US$48 million), the plant will have an initial capacity of 150,000 tonnes when it comes online in 2007. The JV expects to hit full capacity in December 2008, and also expects most of the output to be exported to Korea.
Because of the size of the proposed biodiesel plant, [Sabah State Minister of Industrial Development, Datuk Ewon Ebin] said it was expected to have a huge impact on the growth and direction of oil palm plantation development and palm oil downstream industries in Sabah and neighboring Sarawak.
POIC Sabah is wholly owned by the Sabah state government and its main mission is to develop palm oil industrial clusters in Sabah to encourage downstream processing of palm oil.
Now, London-based Bio Energy International plc announced it will invest more than RM200 million (about US$53 million) to build a palm-oil biodiesel plant in Sabah with initial capacity of 300,000 tonnes annually. (Business Times)
Bio Energy envisions that the plant, which will be built in 2007, will scale to 600,000 tonnes by December 2008 and 1,000,000 tonnes by 2009.
The surge in production to take advantage of the projected boom in biodiesel demand, coupled with the already growing demand for edible palm oil, is raising anew concerns about sustainable palm oil development in rainforest areas such as Sabah, which is judged to have the oldest rainforest extant in the world.