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Sabah set to fully adopt green technology with RM20 bil green steel project

Sabah set to fully adopt green technology with RM20 bil green steel project

09 Jan 2024

Sabah is well on its way to fully adopting the green technology revolution with the RM20 billion green steel project at the Sipitang Oil and Gas Industrial Park (Sogip), said Chief Minister Datuk Seri Hajiji Noor.

Hajiji said the state welcomes investments in products that harness renewable energy, improve waste management and promote sustainable solutions.

“Investing in green technology-based products not only aligns with global sustainability goals but also taps into a rapidly growing market for eco-friendly solutions,” he said in a statement in conjunction with the heads of agreement exchange ceremony at Menara Kinabalu here on Tuesday.

The heads of agreement exchange was between Sabah Energy Corporation Sdn Bhd (SEC), a state-owned natural gas supplier and transporter, and Esteel Enterprise Sabah Sdn Bhd (Esteel Sabah) for the supply of 150 million standard cubic feet per day (mmscfd) of natural gas. 

Representing SEC at the ceremony was chief executive officer Datuk Adzmir Abd Rahman, while Esteel Sabah was represented by managing director Xu Yihang. 

Under the agreement, SEC will supply 100 mmscfd of natural gas to Esteel Sabah’s steel manufacturing plant and an additional 50 mmscfd for the plant’s power generation over the next 20 years.

Hajiji reiterated the point he raised at the Global Chinese Economic and Technology Summit in Shenzen, China last November that Sabah has identified a few key industry areas that not only promise substantial returns on investment but also contribute to a more sustainable and prosperous future.

“This marked Sabah’s confidence in the green steel project, which is among investments that represented the foundation of the state’s economic growth and development strategy,” he said. 

Hajiji added that SEC’s significant contribution to this project highlights its crucial role in promoting sustainable initiatives and fostering regional development.

According to the statement, the green steel project is a three-phase project which opts for natural gas as a reducing agent instead of coke and coal, reducing carbon emissions by 70% and making it low carbon, efficient and environmentally friendly.

Esteel Sabah, a subsidiary of Singapore’s Green Esteel Pte Ltd, signed the land-lease agreement with the Sabah Oil and Gas Development Corporation Sdn Bhd to set up the manufacturing plant at Sogip in Sipitang in November 2022.

Phase one of the project, with an estimated cost of US$1.93 billion ((approximately RM8.97 billion), is expected to commence this year and be completed by 2026, creating approximately 2,795 job opportunities during its operational phase. 

Source: Bernama