Petrochemical and Oil & Gas

Malaysia is the home to both large oil and gas (O&G) and oleochemical industries which supports the development of a vibrant petrochemical and oleochemical (P&O) supply chain. Naturally, P&O is an important core industry in Johor supported by readily-available world class facilities, abundant availability of feedstock and reserves, and talent pool. The state government envisions Johor as a premier P&O hub in the region. The focus, apart from deep water O&G exploration and production, will be to develop upstream and downstream activities with added emphasis on high value-added industry activities. At present, the industry is focused on three key sub-sectors, as well as a host of auxiliary services.

Figure: P&O Investment Opportunities in Johor

Petrochemical Oleochemical Oil & Gas Auxiliary Services
  • Aromatics and olefins
  • Polymer production
  • Plastic fabrication
  • Palm oil refinery
  • Oleochem-based products
  • Derivative products
  • O&G processing
  • O&G support industries
  • O&G manufacturing
  • R&D for new derivate products
  • Industrial biotechnology
  • Green technology (biofuel, biodiesel and biomass)
  • Storage and bunkering activities

Petrochemical

Johor is one of the three states that have a designated petrochemical zone. At present, there are 36 petrochemical establishments in Johor. Almost all the multinational corporations are located in Pasir Gudang and Tanjung Langsat (42%); about 19% are in Tebrau; about 14% in Muar and 6% are in Batu Pahat. Johor is also the home state of the largest ever integrated petroleum complex project in the country, the Pengerang Integrated Petroleum Complex.

Oleochemical

Johor is the second largest crude palm oil producer in the country and the third largest oleochemical producer with a 25% production capacity of the country’s oleochemical market. At present, there are 43 companies (both major and minor players) in Johor which are producing oil and processing basic oleochemicals which includes fatty acids, fatty alcohols, methyl esters, glycerine and acid distillates.

Oil & Gas

The O&G sector is listed as one of the 12 National Key Economic Areas (NKEAs) that aims to develop Malaysia as the main Asian hub for O&G related services. Johor is poised to tap on this national initiative due to its ample land, strategic location and global connectivity.

Plastic Products

The industry, though dispersed throughout the state, is mainly located in Johor Bahru. Ulu Tiram, Senai, Skudai, Masai, Kulai and Pasir Gudang are areas on the outskirts of Johor Bahru city which have high concentration of plastic industries. The plastic industry obtains its feedstock, particularly resins, from petrochemical industries such as Lotte Chemical Titan and Petronas who are among the main suppliers.