KUALA LUMPUR (Nov 29): Malaysia Marine and Heavy Engineering Sdn Bhd (MMHE), a wholly-owned subsidiary of Malaysia Marine and Heavy Engineering Holdings Bhd (MHB), has secured a RM4.5 billion contract from Petronas Carigali Sdn Bhd (PCSB), the marine engineering group filing showed.

The contract is for the engineering, procurement, construction, installation and commissioning (EPCIC) services for the Kasawari carbon capture and storage (CCS) project, located off the coast of Sarawak.

The contract award came after MMHE was awarded the front-end engineering design (FEED) contract in a FEED competition mode for this project early this year.

The EPCIC contract includes the construction of a 14,000-metric tonne (MT) topside, a 15,000-MT 8-legged jacket of Kasawari CCS platform and a bridge linking to the Kasawari central processing platform (CPP).

Upon completion, the platform will be installed in a water depth of 108 metres (m) within the SK316 area, approximately 200 kilometres (km) offshore from the Petronas liquefied natural gas (LNG) Complex in Bintulu, Sarawak.

According to MHB’s bourse filing and statement on Tuesday (Nov 29), the contract has a duration of 35 months, with it being an alliance contract between MMHE and PCSB to execute the EPCIC scope of Kasawari CCS.

Once completed, the Kasawari CCS project will be the largest offshore CCS project in the world by volume of carbon dioxide (CO2) captured, with the ability to capture up to 3.3 million tonnes per annum of CO2, the group said.

A total of about 71 million to 76 million tonnes of CO2 from the Kasawari CCS project will be reinjected into the M1 field via pipeline, which is approximately 138km away from the platform.

Additionally, this facility will also be the world’s largest offshore platform fabricated to capture and store carbon, said MHB in the statement announcing the award.

The Kasawari CCS project, the first ever CCS project in Malaysia, is scheduled to start up by the end of 2025 and will be part of the overall Kasawari gas development project.

MHB managing director and chief executive officer Pandai Othman said the contract award demonstrates PCSB’s continued confidence in the group’s capability to produce the desired results.

“As this contract was won based on a FEED competition, it is also a testament to our cost competitiveness in delivering integrated EPCIC solutions to our customers.

“The award of this contract has increased the order book of MHB to RM6.6 billion, one of the highest ever in our history, which signifies the recovery of the oil and gas industry after a long slowdown period since 2014 and throughout the pandemic era,” he said.

MHB’s share price ended one and a half sen or 3.19% higher at 48 sen on Tuesday, bringing the group a market capitalisation of RM776 million.