Malaysia and Japan plan major cross-border carbon capture project, despite climate benefit doubts

Japan’s Carbon Export Plan to Malaysia Sparks Debate on Climate Solutions

Japan is preparing to embark on a groundbreaking project to ship carbon emissions to Malaysia, marking the first cross-border carbon capture and storage initiative in Southeast Asia. The plan, which could set a precedent for similar projects across the region, has ignited a heated debate among environmental experts and activists about its effectiveness in addressing climate change.

The ambitious project would capture carbon dioxide from Japan’s heavily polluting industries, including electric power, oil refining, cement, shipping and steel sectors. These emissions would then be transported to Malaysia within the next few years for permanent storage in depleted gas fields off the coast of Sarawak on Borneo island.

Malaysia is actively positioning itself as Southeast Asia’s hub for this alternative technology. Last year, the country passed legislation to promote the carbon capture industry, with the Ministry of Economy projecting the sector could contribute up to $250 billion to Malaysia’s economy over the next three decades.

At the heart of this initiative is Petronas, Malaysia’s state-owned oil and gas company, which is investing $1.1 billion to construct what will become the world’s largest offshore carbon storage facility. The project is scheduled to begin operations by the end of the decade, representing a significant bet on carbon capture technology.

For Japan, one of the world’s top five carbon emitters with fossil fuels generating most of its energy, the project represents a potential path toward meeting climate commitments. The country is investing in nine carbon storage sites globally, with three in Malaysia, aiming to store approximately 20 million tons of carbon annually by 2030 – roughly 2% of Japan’s yearly emissions.

The technical process involves capturing emissions directly from industrial sources, separating the carbon dioxide from other gases, liquefying it, and then transporting it in specially designed ships to burial sites. Once injected underground, these sites require ongoing monitoring to prevent leaks.

Despite support from major fossil fuel companies like Exxon Mobil and Shell, who promote carbon capture as a viable climate solution, critics remain deeply skeptical. Rachel Kennerley, a carbon capture specialist with the Center for International Environmental Law, argues that the plan “dangerously shifts the burden of climate change onto Malaysia rather than onto Japan.”

Environmental advocates describe the arrangement as “carbon colonialism,” allowing Japan to continue polluting while outsourcing the consequences. Ayumi Fukakusa of Friends of the Earth Japan has voiced strong opposition to the practice of exporting emissions to other countries, suggesting it perpetuates global inequities in climate responsibility.

The effectiveness of carbon capture technology itself remains contentious. While the International Energy Agency includes carbon capture in its toolkit for addressing climate change, its latest Net Zero Emissions scenario forecasts the technology will contribute less than 5% of emission reductions by 2050.

Grant Hauber from the Institute for Energy Economics and Financial Analysis describes the surge in carbon capture interest as “an almost fantastical theoretical uptick” that “offers a tantalizing promise that just won’t deliver.”

Local opposition in Malaysia centers on financial concerns as well. Eqram Mustaqeem, who has campaigned against carbon capture initiatives in the country, questions the substantial investment in “a technology that is under-delivering and unproven” rather than directing resources toward established decarbonization methods like solar energy deployment or grid improvements.

If successful, experts suggest the Japan-Malaysia project could establish a template for other Southeast Asian nations with carbon storage potential, such as Indonesia and Thailand. However, detractors worry it will ultimately slow progress on global efforts to reduce emissions, which are already falling short of targets needed to limit catastrophic climate change.

The arrangement would likely involve Japan paying Malaysia per ton of emissions stored, allowing Japan to subtract those emissions from its carbon accounting. However, specific financial details and implementation plans have not yet been publicly disclosed by either country’s government agencies.

As this pioneering project moves forward, it highlights the complex tensions between technological solutions, economic opportunities, and environmental justice in the global response to climate change.