Next Generation Oil plans to develop 15,378 hectares of algae plantations over next 12 years

KUALA LUMPUR: Next Generation Oil Sdn Bhd plans to develop 15,378.05 hectares of algae plantations in Malaysia at a development cost of US$38 billion (US$1=RM4.2030) over the next 12 years.

Executive chairman Datuk Indera Mohamed Moiz J M Ali Moiz said with its A-MAP technology, the plantation will be able to cultivate 68 million tonnes of algae biomass to absorb some 76 million tonnes of carbon dioxide and produce about 34 million tonnes of crude algae oil and dry algae cake.

"To implement this project, we need suitable land which we already have from Boustead Plantations Bhd and the Perlis state government. We are currently in discussions with the state government of Kedah, FGV Holdings Bhd and other plantation companies to acquire more land.

"We also need an extensive ecosystem of vendors, contractors and skilled algae tank farmers to make the project a success," he said in his speech at the launch of Algae Farm Tank-Vendor Development Programme (ATF-VDP) today.

The ATF-VDP was launched by the Science, Technology and Innovation Minister Datuk Seri Dr Adham Baba, virtually, while the physical event was held in Mutiara Damansara, Petaling Jaya, Selangor.

The Document of Understanding (DOU) between Next Generation and Boustead Holdings Bhd’s wholly-owned subsidiary, Boustead Technology Sdn Bhd (BT) was signed at the launch today.

"The ATF-VDP to be led by Boustead group will support the manufacturing of 15 million tanks upwards, manufacturing of oil extraction facilities with an aggregate capacity of 34 million tonnes, civil contracts and engineering works, and the procurement of the necessarily trained workforce for the plantations which is expected to be in excess of 100,000 workers," Indera Mohamed Moiz said.

In addition, he said Next Generation have also tied up with Heritage Horizon and Sonata Capital for a US$3 billion Redeemable Convertible Preference Shares (RCPS) funding structure that will allow the group to develop its first 1,214-hectare plantation.

Next Generation has secured US$8.5 billion in offtake contracts for crude algae oil and dry algae cake from international oil majors for its algae oil and is in advance contract negotiations with a number of other oil majors, he added.

"Our dry algae cake can be used as animal and fish feed and also for pulp and paper. We are also working together with B Grimm Power Ltd from Thailand to develop the use of crude algae oil and dry algae cake for use as biomass feedstock for renewable energy power plants to produce sustainable clean electricity," he said.

Next Generation has set up its first plantation and extraction facility on a 18.21-hectare site in Kuantan, Pahang, which is already extracting oil on a pilot plant basis but will be commercially operational by the end of the second quarter this year.

He said the group expected to have 202.34 hectares developed and operational by the end of the first quarter of 2023 and have about 1,214 hectares operational by the fourth quarter of 2024.

On ATF-VDP, Boustead Holdings Bhd deputy group managing director Izaddeen Daud said the programme is part of its initiative to boost the capabilities of local small and medium enterprises (SMEs) in Malaysia.

"The VDP aims to develop competitive, sustainable and high-performing vendors via a structured building programme with the ultimate objective of supporting the government's net-zero carbon aspirations, developing resilient and competitive SMEs and vendors, as well as building the nation’s local capabilities.

"It is set to be part of Boustead group’s new sustainable revenue streams and create a new business ecosystems for employment and vendors as well as strengthen a new sector of economy that will be beneficial for the people and the country," he said in his speech.

He added that, most importantly, the VDP can potentially create new employment opportunities for countrymen as well as army veterans who are Boustead’s main priority.

Izaddeen said with some 100,000 trained workforce required for the 15,378-hectare plantations, of whom 95 per cent is expected to be low to semi-skilled, the VDP ecosystem is set to benefit and promote lucrative opportunities for the ex-service members, veterans and their family members. - Bernama