KUALA LUMPUR: Sime Plantations Sdn Bhd expects to generate income of RM7.5mil annually from its Clean Development Mechanism (CDM) joint-venture projects with a Netherlands-based group.
Sime Plantations is a unit of Sime Darby Bhd.
The pilot CDM project, which will be developed at Sime Plantations' palm oil mill in Kempas, Johor, will start operation by year-end.
Managing director Azhar Abdul Hamid told reporters after the joint-venture signing with BioX Group B.V unit BioX Carbon yesterday that the group had identified five palm oil mills to carry out the CDM projects.
From left: Sime Darby Plantations Sdn Bhd chief financial officer Ho Ee Lay, Azhar Abdul Hamid, BioX managing director Arno Hendriks and Edgare Kerkwijk at the signing ceremony.
Sime Plantations manages about 80,000ha of oil palm plantations in Malaysia and Indonesia. A total of eight palm oil mills are in operation to process harvested crops from its estates. The CDM projects are based on the concept of reducing greenhouse gas emissions – in this case methane gas – by capturing the biogas emitted from palm oil mill effluent anaerobic ponds.
Under the Kyoto Protocol, CDM was introduced to assist countries to achieve greenhouse gas emission reduction targets.
The CDM projects will also enable companies to be given Certified Emission Reduction certificates (CERs). (One unit of CER is equivalent to one tonne of carbon dioxide not emitted.)
BioX Group chief financial officer and head, Asia, Edgare Kerkwijk said the group would initially invest RM2.5mil in the project.
“From 2008 to 2012, we will be looking at an investment worth RM12.5mil.
“We plan to sign CDM project agreements with two or three more listed plantation companies this year,” he added.
Last year, BioX Carbon signed a similar agreement with Tradewinds Group.
BioX Group is one of Europe's largest suppliers of liquid biomass to the energy sector for renewable energy production.
Kerkwijk said BioX Group was also developing four liquid biomass power plants in the European Union (EU).
“We are interested to acquire or form joint ventures in biomass plantations in South-East Asia,” he added.
Malaysia Energy Centre recently reported that the nation had carbon credit potential of up to 100 million tonnes for the 2006-2012 period.
Japan and the UE are among the biggest carbon credit buyers in the world.
RSS