Tuesday, February 17, 2026-Malaysia and Japan have announced a groundbreaking plan to collaborate on a large‑scale cross‑border carbon capture and storage (CCS) project, marking what would be Southeast Asia’s first initiative of its kind aimed at tackling industrial carbon emissions.
Under the proposal, Japan—one of the world’s top carbon emitters—would capture carbon dioxide from its heavily polluting industries, including power generation, oil refining, cement, shipping and steel, and ship the liquefied CO₂ to Malaysia for underground storage in depleted gas fields off the coast of Sarawak. This project reflects deepening bilateral cooperation on climate technologies and carbon management.
For Malaysia, the project presents an opportunity to position itself as a regional hub for carbon capture technology and storage, building on domestic efforts to expand CCS infrastructure despite the fact that about 81 % of its electricity still comes from fossil fuels.
Malaysian energy firms, including its state‑owned oil giant, are investing in offshore facilities and partnerships that could support both local storage and cross‑border shipments of captured CO₂. If developed successfully, the initiative could also act as a model for other Southeast Asian countries with suitable geological storage potential, such as Indonesia and Thailand.
However, the project remains highly controversial among climate analysts and activists, who argue that carbon capture may offer limited climate benefits and risk distracting from more direct emissions reductions like expanding renewable energy. Critics say the plan could allow Japan to effectively outsource its carbon burden while placing storage and monitoring responsibilities on Malaysia. Supporters, by contrast, view CCS as an important tool in managing hard‑to‑decarbonize industrial emissions, though its overall contribution to global emissions reduction is expected to be modest.
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