B20 biodiesel programme for Sabah and Sarawak deferred

Expansion to East Malaysia was initially scheduled to be launched in Sarawak last month and in Sabah this month


THE implementation of the national B20 biodiesel programme for the transport sector in Sabah and Sarawak will be deferred to January 2021 and September 2020 respectively due to the Covid-19 pandemic.

The expansion of the programme to East Malaysia was initially scheduled to be launched in Sarawak last month and in Sabah this month.

The Plantation Industries and Commodities Minister Datuk Dr Mohd Khairuddin Aman Razali, however, said the Covid-19 outbreak, which led to the enforcement of the Movement Control Order (MCO) nationwide, has hindered the process.

“The move (MCO) has caused various constraints and challenges, especially in the upgrading of 35 biodiesel blending depots needed for the supply of B20 diesel mix.

“It is hoped that the new dates that have been agreed by all parties, after taking into account the current issues faced, will be able to improve the country’s palm oil industry in the future,” he said during a press conference in Putrajaya yesterday after a meeting with petroleum companies.

He said the implementation of the programme throughout Peninsular Malaysia remains unchanged and will be on June 15, 2021. The programme was launched in February, but has been retailed in stages in Langkawi, Kedah, and Labuan since January.

The government has also allocated RM35 million to conduct studies and upgrade 35 biodiesel blending terminals to ensure the terminals have the capacity to handle up to 30% of palm methyl ester blended diesel (B30).

Studies and upgrading works have begun since January, and the completion of the processes is expected to be in June 2021.

Mohd Khairuddin said the programme, which is meant to encourage the utilisation of domestic palm oil, is expected to increase the fuel’s yearly usage by 20 million tonnes.

“Taking into account the implementation of B20 biodiesel programme for the transportation sector and B7 biodiesel programme for the industrial sector, it is estimated that approximately 1.3 million tonnes of palm oil will be used yearly in the country which will contribute to lesser greenhouse gases (GHG) emission.

“It also reflects the government’s commitment in reducing GHG emission and preserving nature,” he added.

It was reported that weaker export demand for crude palm oil and the delay in B20 biodiesel adoption could increase the country’s palm oil stockpile to more than two million tonnes by the end of the year.

In January, Malaysia’s palm oil stock levels were recorded at 1.75 million tonnes. It, however, jumped to two million tonnes in April due to the increase in output and lower demand amid the pandemic.

Based on official data, the country’s palm oil export also dropped 41.7% from 1.53 million tonnes to 890,331 tonnes during the first month of the MCO, which began on March 18, compared to the same period last year.