UAE-Malaysia partnership to build South-East Asia's first sustainable aviation fuel refinery

The Star

25-04-2025

KUALA LUMPUR: With a US$500mil (RM2.19bil) investment, UAE-based Bin Zayed International Group (BZI) and Malaysia's FatHopes Energy (FHE) are joining forces in a landmark partnership.
The collaboration, according to the two firms, will deliver one of the world's most forward-looking sustainable aviation fuel (SAF) refineries in Port Klang - a move expected to transform the regional clean aviation landscape.
Managing Director of BZI (Malaysia) Berhad Datuk Seri Dr Shamir Kumar Nandy said the integrated facility - among the first of its kind in Southeast Asia - will produce SAF via the HEFA pathway, which currently accounts for over 80% of global SAF production.
Backed entirely by BZI's investment, he said the project is expected to break ground by 2026 and commence commercial operations in 2029.
'We are underwriting the entire sum for now by ourselves. Based on FatHopes' findings and updates, they're in the process of getting the necessary approvals and sanctions before they can break ground.
'So I believe that will be a year down the road — about 12 months from today (Friday, April 25),' he said during a press conference at the BZI office here on Friday (April 25).
Also present at the announcement ceremony of the strategic investment between BZI and FatHopes Energy was Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad.
He said the collaboration brings together BZI's global investment expertise and FHE's leadership in sustainable biofuel feedstock aggregation, laying the groundwork for a highly diversified and scalable SAF platform in the region.
The Port Klang refinery, he said is expected to anchor Malaysia's broader ambition to produce one million tonnes of SAF annually, bolstering the country's position as a central player in the global SAF economy.
'This initiative has the potential to reimagine the future of flight.
'We will also explore advanced SAF technologies alongside FHE's refining partner and technology provider.
'It's about profit, people and the planet, that's what inspired this partnership, but most importantly, it's for the planet,' Shamir added.
From FHE's perspective, the project is currently at the feasibility stage and is being developed as a 300,000-tonne-per-annum facility.
'That will be the production capacity, which will require about 330,000 tonnes of feed material,' said Vinesh Sinha, Chief Executive Officer of FatHopes Energy.
'The technology is capable of processing multiple feedstocks and will be guided by prevailing policies and certifications.'
While financing has been fully committed by BZI, Sinha acknowledged that the primary challenges lie in the technical aspects of the refinery's development.
'The biggest challenge that we face is really on the technical front.
'There's a lot of input materials we need — hydrogen and nitrogen, which are major components of the manufacturing process,' he said.
'We are in the midst of identifying sources for those. And then there's the port infrastructure, which is also a key factor.
'On our end, we are really focused on technical readiness and securing EIA clearance for this particular plant,' Sinha added.
Earlier in his speech, Nik Nazmi said the proposed SAF refinery in Port Klang will be a game-changer for Malaysia's energy and aviation sectors.
'This investment will serve as a catalyst for far-reaching transformation across our energy and aviation sectors,' he said.
He said the project aligns with Malaysia's climate goals under the Paris Agreement and reinforces the country's position as a regional leader in the fast-growing Southeast Asian SAF market.
'Air travel is essential, but it must become sustainable.
'This refinery will help decarbonise the aviation sector while enhancing our energy security and supporting Malaysia's net-zero aspirations,' he said.
Nik Nazmi also highlighted the project's socio-economic value, saying it will create jobs and benefit communities involved in the biofuel supply chain.
'This project shows that sustainability and economic opportunity can go hand in hand,' he added.