PETRONAS, TotalEnergies and Mitsui have signed a joint venture agreement to develop offshore carbon storage facilities in Peninsular Malaysia, advancing the country’s ambition to become a regional carbon capture and storage (CCS) hub.

 

The agreement brings together PETRONAS’ wholly-owned subsidiary, PETRONAS CCS Ventures Sdn. Bhd. (PCCSV), TotalEnergies EP CCS Malaysia (TotalEnergies) and Mitsui & Co., Ltd. (Mitsui) to drive the development, commercialisation and operation of carbon storage areas under Malaysia’s Southern CCS Hub.

 

The project’s first phase will focus on a depleted gas field offshore Peninsular Malaysia, with an expected CO2 injection capacity of up to 5 million tonnes per annum. First injection is targeted as early as 2031, subject to industry readiness.

 

The deal marks a significant step in the partners’ push to advance carbon storage infrastructure capable of supporting emissions reduction efforts across the Asia Pacific region, particularly in hard-to-abate industries.

 

The agreement builds on a Carbon Capture and Storage Development Agreement signed in 2023, which paved the way for development studies and technical evaluations of potential offshore storage sites. In 2025, the partners signed a Key Principles Agreement, laying the groundwork for front-end engineering and design (FEED) activities and the joint venture structure.

 

The latest agreement establishes the framework for a dedicated joint venture company to take the storage project forward, with the partners now focused on strengthening its technical and commercial readiness ahead of a final investment decision (FID).

 

Emry Hisham Yusoff, PCCSV’s Chief Executive Officer, said: "The Joint Venture Agreement is a reflection of the strong partnership we have built with our strategic partners over the years. From our early development studies through to FEED activities, we have worked closely together to mature this opportunity and establish a shared vision for the Southern CCS Hub. 

 

"By bringing together PETRONAS’ subsurface expertise, with their global CCS experience, commercial and logistics capabilities, we are confident in maintaining this momentum towards achieving Final Investment Decision (FID) in the near future while advancing Malaysia’s ambition to become a leading regional CCS hub.”

 

The Southern CCS Hub is designed to provide safe, reliable and long-term CO2 storage for industries facing significant challenges in cutting emissions. It is expected to accommodate CO2 from domestic and regional sources, including potential cross-border shipments.

 

The partnership combines PCCSV’s subsurface and project management expertise with TotalEnergies’ global CCS development experience and Mitsui’s capabilities in commercial development, project investment and logistics.

 

The partners will now work to advance the initial storage project towards an investment decision, as Malaysia seeks to strengthen its position in the emerging regional carbon storage market.