Cenergi, Kwantas ink gas plant agreement

Kota Kinabalu: Cenergi SEA Berhad (Cenergi), a subsidiary of UEM Lestra Berhad, has signed a Build-Own-Operate (BOO) Agreement with Kwantas Corporation Berhad (Kwantas) for the development of its first Bio-Compressed Natural Gas (Bio-CNG) plant in Lahad Datu.

This milestone follows the joint venture (JV) partnership established in 2024 between Cenergi and Kwantas, a Sabah-based integrated palm oil producer with operations across the entire palm oil supply chain, both locally and in China.

Under the BOO framework, the JV entity, Cenergi Kwantas Pintasan Sdn Bhd, will develop the Bio-CNG plant on approximately 4.9 acres of land adjacent to Pintasan Palm Oil Mill, owned by Kwantas.

According to a statement, the plant will process the Palm Oil Mill Effluent (POME) waste derived from the Palm Oil Mill, the Biogas captured will then be treated and purified into Biomethane, and finally compressed into Bio-CNG for sale to industrial off-takers as a clean fuel and sustainable energy.

Cenergi SEA Berhad Acting Group CEO Ir Kwok Yew Hoe emphasised the project’s strategic importance, stating this project represents a significant milestone for Cenergi as it expand its renewable energy footprint in Sabah.

“Through innovative technology, we are not only enhancing the treatment of palm oil waste to meet regulatory standards but also unlocking new value through sustainable energy production.

”He further added, “Our commitment to environmental stewardship is reflected in projects like this. By transforming POME into Bio-CNG, we are providing industries with a reliable, low-carbon fuel alternative while simultaneously reducing greenhouse gas emissions and supporting Malaysia’s net-zero ambitions.

”Kwantas Executive Director Dato’ Winson Chong stated that the collaboration efforts between Kwantas and Cenergi to develop a Bio-CNG plant in Lahad Datu is expected to become a game-changer in the palm oil industry in Sabah, as green and clean fuel, a form of renewable energy can now be produced simultaneously with the production of crude palm oil and palm kernel.

“Other than the Palm Oil Mill is able to comply with environmental regulations and emission standards, such sustainable integrated processing activities shall pave way to emerging market of green natural gas supply, to meet the industrial fuel and energy demands in the East Coast of Sabah.

”The development of this Bio-CNG plant directly supports Malaysia’s National Energy Transition Roadmap (NETR), accelerating the nation’s shift towards renewable energy while strengthening the circular economy through waste-to-energy- innovation.