Malaysia’s state-run oil and gas company Petronas signed a memorandum of understanding on Aug. 3 with six Korean companies to launch a carbon capture and storage (CCS) project called Shepherd CCS Project, with an aim to capture carbon in South Korea and store it in Malaysia.
The six companies are Samsung Heavy Industries, Samsung Engineering, Lotte Chemical, GS Energy, SK Energy and SK Earthon. They will jointly develop the project that is located in Malaysian state of Sarawak. Feasibility studies for the cross-border project will be conducted soon.
The same MOU was previously signed by POSCO Engineering & Construction, POSCO International, and Petronas to help Malaysia become a carbon storage hub based on the carbon capture, utilization, and storage (CCUS) technology POSCO Group is developing. Likewise, an MoU for joint CCS research between SK E&S and Indonesian natural gas transportation and distribution company PGN was inked in Indonesia.
Investment in CCUS in Southeast Asian countries has rapidly increased recently. Seven countries, including Brunei, Singapore, Indonesia, and Malaysia, are now developing CCUS projects due to the region’s high dependence on coal, oil and natural gas. They won’t have to close the fossil fuel-based power generation facilities if they manage to cut the carbon emissions by using CCUS techniques.
For South Korea, working with Southeast Asia can bring great benefits since South Korea has few places to store carbon, while Southeast Asia has plenty of empty oil and natural gas grilling spots that can be used for carbon storage. Moreover, South Korea is close to Southeast Asia, meaning low carbon transportation costs.
Furthermore, the CCUS technology can later support the development of liquified natural gas (LNG) projects and hydrogen in Indonesia, Malaysia, and other Southeast countries. With CCUS technology, carbon from LNG and hydrogen generation can be stored underground for later utilization.