Singapore, Brunei Firms Win RM1.65bil 'Green' Fuel Project in Sabah

Singapore-based Oiltek International Ltd and Brunei's BioSeaga Industries Sdn Bhd have agreed to collaborate on a large-scale sustainable aviation fuel (SAF) biorefinery in Sabah.

The project, valued at US$350 million (RM1.65 billion), is planned to have a production capacity of 300 tonnes per day.

This project is expected to kick off in the fourth quarter of 2026.

"Phase 1 carries an estimated development value of US$350 million, with future expansion into advanced fuels including green hydrogen and other low-carbon energy derivatives," it said in a statement.

Oiltek said the planned facility will use palm oil mill effluent and used cooking oil as its main feedstocks.

"Designed as a multi-feedstock, modular, and scalable biorefinery, the project will form part of a broader integrated SAF ecosystem spanning production, blending and export.

"Upon completion, it is expected to position Sabah as one of the largest SAF production centres in the region, with the potential to scale into a globally significant hub supporting aviation decarbonisation efforts," it added.

Oiltek chief executive officer and executive director Henry Yong Khai Weng said the project offers a strategically important opportunity for the company to apply its established engineering, procurement, construction, and commissioning (EPCC) expertise.

He added that the company will also leverage its experience across the SAF value chain to execute and deliver a large-scale, commercially significant development.

Oiltek announced plans for a secondary listing on Bursa Malaysia's Main Market and has appointed M&A Securities Sdn Bhd as the advisor for the process.

Oiltek Sdn Bhd (Oiltek Malaysia), a subsidiary of Oiltek, has been appointed as the exclusive EPCC partner for the plant's pre-treatment facilities, SAF production plant and tank farm and logistics bulking infrastructure.

The company will also handle the plant's partial blending facilities.

"Oiltek Malaysia shall also have the right of first refusal to participate in any equity investment, joint venture, or ownership opportunity related to the project or its subsequent phases," the company said.

Source: www.nst.com.my