KOTA KINABALU: Sabah has taken the first step towards venturing into biomass development with the signing of a Memorandum of Understanding (MoU) to set up satellite biomass collection centres.

The signing between three entities - the Palm Oil Industrial Cluster (POIC), BELL Corporation Sdn Bhd and My Clean Energy Sdn Bhd, will see more stakeholders come together to make this a reality.

Deputy Chief Minister Datuk Seri Raymond Tan Shu Kiah, who is also Industrial Development minister, said that this first step taken is a result of the years of discussions, seminars and similar programmes to tap into biomass development.

"Sabah is among the largest palm oil producers (1.5mil ha) in the country and the amount of waste from this industry is huge" he said after witnessing the signing ceremony here, yesterday.

He said these wastes could in turn become wealth, if managed properly.

Tan said this has taken so long to even kick start because of the numerous challenges faced including to get mills to collaborate and agree to have their industrial wastes be used for this purpose.

"They (operators) were unsure of what they would get out of agreeing, and no agreement on the price per tonne of palm oil waste could be achieved then, but now we are in the midst of finalising most details" he said.

"Many of them choose to just keep or hold on to these wastes instead of letting them go to proper channels" he said.

He hopes that the agreement will be the document for the setting up of biomass collection centres and will finally, stabilise the price of biomass and ensure the long-term supply of biomass.

If the centres have been set up, palm oil mills will need to go through several layers of treatment of their palm wastes before ‘dumping' them into specific centres to be collected and sent to the POIC for further process. Currently, most mills in Lahad Datu have agreed to be part of this project. Potential investors have also lined up to be part of it.

More signings towards making the setting up of biomass collection centres are expected within these few months. POIC Sabah Sdn Bhd Chief Executive Officer (CEO), Dr. Pang Teck Wai said the collection centres will clear hurdles on oil palm biomass and supply security for the first time, the two major factors hindering the take off of the billion-ringgit biomass downstream industry in the state.

"All biomass have commercial and industrial uses in pellets, compost, briquettes, energy, biochemical, etc" he said, adding this signing is also a testament that the palm oil industry can be sustainable.

Under the MoU, BELL Corporation will provide land, some 50km from Lahad Datu for gathering of biomass from its nearby mills.

The logistics is provided by My Clear Energy who will transport the biomass such as empty fruit bunch (EFB) from the mills to the gathering site.

"With these structures in place, we now think that we have found a workable platform much like a supermarket where biomass investors can come and by EFB both in small and large quantities" he said.

POIC Trading was represented by Dr Pang, BELL Corporation was represented by its CEO, Puan Sri Dr Liana Low, while My Clear Energy was represented by its chairman, Jeffrey Lu.