KERTIH, TERENGGANU October 6: The East Coast Economic Region (ECER) added yet another key milestone in its development with the construction of the world’s first integrated bio-methionine and thiochemicals plant worth RM2 billion in the Kertih BioPolymer Park, a major project that is expected to position Terengganu as a centre of new technologies and a regional leader in biorefinery.

Located on a 70 hectare land in ECER’s Kertih Biopolymer Park, the project involves the development of Korea’s CJ CheilJedang (CJ)’s bio-methionine plant and France’s Arkema’s thiochemicals platform that will come on stream at the end of 2013. The integrated facility will be the first in the world to use fermentation process in producing L-methionine, an amino acid commonly used in the manufacturing of animal feed. The East Coast Economic Region Development Council (ECERDC) and Malaysian Biotechnology Corporation (BiotechCorp) are joint-promoters of the project.

Prime Minister Dato’ Sri Mohd Najib Tun Abdul Razak officiated the ground breaking ceremony at Kertih Biopolymer Park here today. Also present at the ceremony were Terengganu Menteri Besar Dato’ Seri Ahmad Said; Chief Executive Officer of CJ CheilJedang, Mr. Kim Chul Ha; Executive Vice President of Arkema, Mr Marc Schuller; Ambassador of the Republic of Korea to Malaysia, Mr. Lee Yong Joon; Ambassador of France to Malaysia, Madame Martine Dorance; Chief Executive Officer of ECERDC, Dato’ Jebasingam Issace John; and, Chief Executive Officer of BiotechCorp, Dato’ Dr Mohd Nazlee Kamal.

CJ is a world leader in the area of industrial biotechnology with innovations in fermentation and purification. It is a leading producer of fermentation-based products with business operations in six continents, while Arkema is a global chemical company and France’s leading specialty chemicals producer with operations in more than 40 countries.

The integrated facility will enable CJ to respond to strong demand for methionine; a sulphur amino acid widely used for animal feed in Asia, and allows Arkema to better serve its Asian customers from a new industrial platform.

“This significant project will strengthen and consolidate our position as the world’s leader in sulphur chemicals and allow our company to meet the growing needs of our customers & partners from petrochemicals, animal nutrition and oil & gas markets in Asia,” declared Marc Schuller, Executive Vice President of Arkema.

“This is a very significant day for CJ’s BIO business in its 45-year history. In many ways, it is the start of a new beginning for CJ,” said CJ CheilJedang’s Chief Executive Officer, Mr Kim Chul Ha in his speech at the ceremony.

“Firstly, Bio-Methionine will be the first major new product that will decide the future of CJ’s BIO business for next 50 years. Secondly, the Bio-Methionine Project will be the first major joint-venture project with a respected chemical company in Arkema. We are also looking forward to the partnership with the Malaysian government (via ECERDC and BiotechCorp) and the State of Terengganu,” he noted.

Marking several firsts in the biotechnology industry, the investment by CJ and Arkema will be a breakthrough for the global feed additives industry as the production of bio-methionine will pool together both biotechnology advancement and applied chemistry for the first time.
The collaboration by CJ and Arkema is expected to generate a Gross National Income (GNI) of RM11.1 billion and some RM20 billion in sales by 2020, as well as nearly 500 employment opportunities, most of which will be sourced locally.

The project will also create spill-over economic effects, such as the plantation of biomass plants comprising Acacia mangium and Leucaena leucocephala or locally known as “Petai Belalang”, that will be used as feedstock by the biotech players in Kertih BioPolymer Park. The “Petai Belalang” plantation project is expected to benefit some 3,000 local smallholders, who have the potential of earning an additional monthly income of about RM2,500 each.

Local Small and Medium Enterprises (SMEs) can also take advantage of the opportunities created by this project by providing support to the development of this ecosystem.

Commenting on today’s ground breaking ceremony, Menteri Besar of Terengganu, Dato’ Seri Ahmad Said expressed his pride in Terengganu as host to the world’s first green fermentation based bio L-methionine plant that will put the state on the world map for industrial biotechnology.

Dato’ Seri Ahmad commended the role played by ECERDC and BiotechCorp in bringing in biotechnology-related investments into Terengganu, particularly in the Kertih BioPolymer Park and he gave the reassurance that the State Government will give its full commitment in ensuring the successful implementation of these projects.

“The State Government fully recognises the importance of biotechnology as a new economic sector that is able to make a significant contribution both in terms of resources and revenue, instead of relying solely on oil and gas revenue,” he noted.

ECERDC Chief Executive Officer Dato’ Jebasingam Issace John said today’s ground breaking was a milestone for ECER as it signalled the Region’s readiness to receive investments from high value sectors.

“Kertih BioPolymer Park is set to provide commercial opportunities to biotechnology companies from all over the world and we are confident that this collaboration by CJ and Arkema will attract the arrival of more global biotech players in Kertih BioPolymer Park in the near future,” he said.
Kertih Biopolymer Park is one of the key projects in the ECER Special Economic Zone (ECER SEZ), a concentration of high-impact projects spanning from Kertih in Terengganu to Kuantan in Pahang, that will be the catalyst of economic growth in ECER Malaysia. Offering vast investment opportunities and synergies to biotech industry players, the ECER SEZ is able to serve as the main gateway for investors to tap into the ASEAN, Asia Pacific and Far East markets with a combined population of four billion and Gross Domestic Product of US$17 trillion.

Originally established as the Kertih Polymer Park by ECERDC, Kertih BioPolymer Park received a major boost in June this year with the signing of a strategic collaboration between the Terengganu State Government, ECERDC and BiotechCorp to develop a biorefinery complex which is the first in Malaysia to utilize cellulosic feedstock to produce bioderivatives, such as advanced carbohydrates, biochemicals, biomaterials, biofertilizers and active feed ingredient.

Located within KBP, the biorefinery complex which is slated to be operational by 2013, will be using renewable energy from biomass as opposed to natural gas. The total project is expected to generate a cumulative GNI of RM20.4 billion by 2020 and produce 2,500 green-jobs for Malaysia.
With anticipated FDIs totalling around RM7 billion, the 1,000-hectare biorefinery complex located at Kertih BioPolymer Park is expected to be occupied by eight global industrial biotechnology players by 2015.

Kertih BioPolymer Park’s close proximity to PETRONAS’ Kertih Integrated Petrochemical Complex, allows cross supply of products between both complexes, while providing economies of scale for utilities supply and logistics. In addition, Kertih BioPolymer Park also has easy access to input required to produce biopolymer and biochemical products, such as wood chips from the nearby forest plantation.

A biorefinery shares a similar concept to a petroleum refinery plant which produces multiple fuels and chemical products from petroleum. A biorefinery takes advantage of the various components in biomass, such as the Acacia mangium and “Petai Belalang”, and their intermediates, to maximise the value derived from the biomass feedstocks.

To ensure ready and reliable supply of biomass to biotechnology players in Kertih BioPolymer Park, the State has already commenced on the biomass plantation project, starting with 40,000 seedlings of “Petai Belalang” on a two-hectare area in the Merchang Forest Reserve last month. This development is also part of the Terengganu’s State Government’s initiative to allocate 30,000 hectares of land dedicated for the feedstock plantation that will produce 10.5 million tonnes of wood chips annually from the “Petai Belalang” plant.

“Aside from an abundant supply of feedstock, Malaysia has an advantage in market access and overall sound business environment which among other factors, respects private property and Intellectual Property rights. Combined with Government support and policies, this will certainly be a contributing factor towards driving Malaysia’s bioeconomy agenda and achieving its target to become the regional biorefinery hub by 2015,” commented Dato’ Dr Mohd Nazlee Kamal, CEO of BiotechCorp.

Malaysia is pushing through the Bioeconomy agenda and intensifying national efforts to maximize the potential economic benefits of the entire biotechnology ecosystem and related value chains. The Bioeconomy Initiative Malaysia (BIM) is a framework to implement the action plan outlined in the National Biotechnology Policy (NBP) for development of the biotechnology industry in various fields. The BIM expects to increase Gross National Income by RM3.6 billion, attract investments of RM10 billion into Malaysia’s biotechnology industry and create 16,300 new high quality job opportunities for Malaysians by 2020.

It is anticipated that growth in the biotechnology sector will be supported by leveraging on the availability of natural resources and Malaysia’s strong manufacturing sector to increase the processing and manufacturing of biotech-related products.

The NBP envisions that biotechnology will be a new economic engine for Malaysia, enhancing the nation’s prosperity and well-being. To succeed, the Policy aims to build a conducive environment for R&D and industry development while leveraging on the country’s existing areas of strength.