Sarawak eyes US$1 bln downstream investment in Bintulu

KUCHING: Sarawak is exploring a potential US$1 billion investment in Bintulu to turn natural gas into higher value products while expanding opportunities for cleaner industrial production.

Deputy Minister for Energy and Environmental Sustainability Datuk Dr Hazland Abang Hipni said detailed discussions would follow between Indorama, HighChem and Sarawak Petchem on the proposed development.

“This is about moving up the value chain, including materials for clothing and ways to recycle products derived from gas,” he said when speaking at the two-day Asia Refining and Petrochemicals Tech Forum (ASIA-TECH) 2026, in Bangkok which began on Oct 7.

HighChem has signed a memorandum of understanding with Sarawak Petchem for a proposed syngas-to-monoethylene glycol plant at the Bintulu Petrochemical Industrial Park and proposed Sarawak as a pilot location for technology that converts carbon dioxide into paraxylene, a raw material for polyester.

Hazland said potential collaboration with Indorama, a major producer of polyester and speciality chemicals, could connect Sarawak’s gas and cleaner electricity supply with the production of packaging, textiles and other downstream materials.

He said the approach could generate greater economic value and skilled employment while reducing emissions per tonne of production.

According to a statement, supporting this industrial transition is the Bintulu Transitioning Industrial Cluster, which brings together more than 20 participants to improve efficiency, share infrastructure and accelerate efforts to reduce industrial emissions.

Its four pilot initiatives this year cover smart manufacturing, carbon capture and utilisation combined with hydrogen, the use of industrial by-products as feedstock, and workforce upskilling.

Sarawak Petchem is also evaluating sustainable aviation fuel production pathways, including the potential use of biomass and resources recovered from palm oil mill effluent to turn agricultural waste into fuel inputs.

Other initiatives include a proposed green hydrogen unit to lower the carbon intensity of methanol production and an ammonia and urea project with PETRONAS Chemicals Group that is undergoing a feasibility study.

Hazland said the projects were at different stages of development, with progress dependent on technical feasibility, competitive production costs, market demand and strong industry partnerships.

“Sarawak welcomes collaboration with technology providers, investors and potential buyers to turn these opportunities into viable projects that support a more sustainable fuels and petrochemical industry,” he said.