Next Generation Oil seeks local vendors for role in multibillion ringgit algae project

The RM159.6b ATF-VDP, to be managed with Boustead, will champion Malaysia’s drive towards NZCE before 2050 

by NUR HANANI AZMAN / Pic credit:

NEXT Generation Oil (Group) Sdn Bhd (NGOG) has called on local manufacturers to join its new Algae Farm Tank-Vendor Development Programme (ATF-VDP) to support the cultivation of 15,378ha or 38,000 acres of micro algae with total development cost estimated at US$38 billion (RM159.64 billion). 

NGOG executive chairman, Datuk Indera Mohamed Moiz said the ATF-VDP will be managed with Boustead Holdings Bhd and simultaneously champion Malaysia’s drive towards becoming a Net Zero Carbon Emitter (NZCE) before 2050. 

“We need 15 million tanks to cultivate algae over the next 10 years, which will produce 68 million tonnes of algae biomass, absorb about 76 million tonnes of CO2 and produce 34 million tonnes of crude algae oil and dry algae cake. 

“We want to help make Malaysia net-zero carbon before 2050 and the volume of micro algae we are cultivating will create a natural carbon sink,” he told reporters after the launch of the programme last week. 

NGOG will be exploring a dual funding strategy with Heritage Horizon and Sonata Capital for an initial US$3 billion Redeemable Convertible Preference Shares (RCPS) funding structure for the development of the first tranche of 3,000 acres of the farm. 

Subscribers of the RCPS will come from conventional investors as well as asset-based token investors. 

NGOG signed a Document of Understanding with Boustead’s wholly owned subsidiary — Boustead Technology Sdn Bhd — with the latter envisioned to be the strategic partner for ATF-VDP, leveraging on NGOG’s patented AlgaeModular Automated Plantation technology. 

Both parties will explore the development and structure of the ATF-VDP, which aims to produce an ecosystem of vendors in the tank fabrication and maintenance process. 

Boustead group MD Datuk Sri Mohammed Shazalli Ramly said the venture is in line with Reinventing Boustead’s continuous strategy to create a new VDP ecosystem and employment to promote improved life quality for retired soldiers who will play a major role in the project. 

It is set to provide lucrative opportunities for the ex-service members of the Malaysian Armed Forces termed Boustead Green Army. 

“The invention of the ATF-VDP ecosystem marks yet another milestone as part of our drive towards our very own Environmental, Social and Governance initiative under the Boustead Hijau agenda. 

“We foresee the manufacturing of millions of ATF for thousands of land acres for algae cultivation farms will support the nation’s netzero agenda, while we make full effort into potentially closing the global gap in greenhouse gas emissions,” he said. 

Boustead and NGOG initiated this partnership to jointly explore and promote the development of crude algae oil in Malaysia as a new carbon neutral biomass commodity in the renewable-energy space back in April 2021. 

Boustead, through Boustead Plantations Bhd, entered into a conditional land-lease agreement in September 2021 for its Telok Sengat Estate with NGOG as the first commercial development site for this venture. 

Although Malaysia contributes less than 0.7% of the global greenhouse gas emissions, the 12th Malaysia Plan targets to reduce emission intensity of its GDP by 45% in 2030 from the 2005 baseline, in line with the aspiration to become a low-carbon country by year 2050.