Bridging Ambition and Action: Malaysia's CCUS Journey

Summary

Carbon Capture, Utilisation and Storage (CCUS) plays a pivotal role in Malaysia’s climate strategy, as outlined in the National Energy Transition Roadmap (NETR). Recognised as a flagship technology, CCUS is essential for reducing emissions in hard-to-abate sectors and achieving Malaysia’s net-zero emissions target by 2050.

CCUS is also prominently featured in the National Energy Policy (NEP) 2022–2040, particularly as a tool to mitigate greenhouse gas (GHG) emissions from the oil and gas sector. Additionally, the New Industrial Master Plan 2030 (NIMP 2030) identifies CCUS as a key solution for carbon abatement in the manufacturing industry.

To establish itself as a regional leader in carbon capture and storage, Malaysia aims to develop multiple CO₂ storage hubs by 2030. A major milestone in this journey was the enactment of the CCUS Act 2025 (Act 870), following royal assent from His Majesty Sultan Ibrahim, King of Malaysia. This landmark legislation provides Malaysia’s first comprehensive federal legal framework for CCUS, including provisions that allow the import and storage of CO₂ from other countries. This enhances regulatory clarity and boosts investor confidence in Malaysia’s CCUS ecosystem.

Beyond storage, Malaysia is also placing significant emphasis on utilising captured CO₂ to complete the CCUS cycle. The country is exploring the conversion of CO₂ into commercially valuable products, with a focus on bio-based materials, CO₂-enriched agriculture, and synthetic fuels.

Malaysia supports the development of a harmonised regional framework for ASEAN and is actively engaging in international agreements to facilitate the cross-border transportation of CO₂, reinforcing its commitment to regional collaboration in CCUS initiatives.

This report explores the evolving policy and investment frameworks, Malaysia’s future potential as a CCUS hub through their groundbreaking projects, barriers to overcome, and the way forward to accelerate CCUS.