Firm Commitments from all ECAs will support Pengerang Energy Complex’s (PEC) setting up a latest generation, low carbon Petrochemical facility in Pengerang, Johor.
16 December 2024, Kuala Lumpur/Singapore – Pengerang Energy Complex (PEC) announced today it has successfully secured agreement on financing terms for USD 3.5 billion project financing from leading export credit agencies (ECAs) across North America, Western and Southern Europe, and Asia, as well as Islamic financing from entities of the Islamic Development Bank.
Representatives of each of the five ECAs, namely the Export-Import Bank of the United States (US EXIM), Euler Hermes AG, Italian Export Credit Agency (SACE), Compañía Española de Seguros de Crédito a la Exportación (CESCE), Export-Import Bank of Malaysia Berhad (EXIM Bank Malaysia) and IsDB were present in Kuala Lumpur to ratify the terms for the financing agreements with representatives from PEC, which is being developed by Singapore-based petrochemicals, green energy and natural resources conglomerate, ChemOne Group.
The event was also attended by leading European and international banks who have confirmed participation in the ECA-guaranteed tranches as well as the Islamic financing tranches.
The capital secured will be channelled towards implementation of the USD 5.3 billion latest generation, low carbon Petrochemical facility designed to produce 2.6 million metric tonnes per annum (mmtpa) of Aromatic products and 3.0 mmtpa of associated energy products. The commencement of construction will start in mid-2025 and the project will go on stream in Q4, 2028.
Mr. Alwyn Bowden, CEO of Pengerang Energy Complex Sdn Bhd, commented: “We are pleased to have secured this significant round of project financing from these five leading global export credit agencies and Islamic Development Bank entities, which will help further bolster the financial stability of PEC and accelerate progress for the project which is already well underway in terms of planning and engineering.
“We are grateful for the confidence our partners have shown in this project, and the discussions held today will enable us to fully conclude the debt financing for the Project within the coming few months and move to commencement of construction for this Global benchmark setting project by the middle of next year. As the petrochemicals industry is set to grow exponentially, alongside rapid economic development across East Asia and Southeast Asia, the PEC project is poised to form a key driver of demand for quality aromatics in the medium to long term. PEC is strategically located to serve the regional Asian markets and satisfy forecasted demand.”
“EXIM Bank Malaysia is proud to play a pivotal role in the financing of the Pengerang Energy Complex’s new facility, a landmark project that underscores Malaysia’s commitment to advancing low-carbon industrial innovation. This initiative aligns with our sustainability commitment and is instrumental in showcasing how global collaboration can drive transformative change in high-growth sectors like petrochemicals. Together with our international partners, we are enabling a state-of-the-art facility that not only enhances Malaysia’s economic resilience but also sets a benchmark for sustainable industrial practices in the region,” says Mr. Raymond Fam, Director of EXIM Bank Malaysia.
About the project
Located within the Pengerang Integrated Petroleum Complex (PIPC) in Johor, PEC is set to be one of the largest and most competitive integrated condensate splitter and aromatics facilities in the world. It is being built using UOP Honeywell’s latest generation LD Parex technology which will effectively help the project reduce its energy consumption, maximise aromatics production, lower capital and energy costs as well as facilitate wider feedstock flexibility, allowing the PEC plant to become one of the most advanced, energy and carbon efficient facilities in its class.
Throughout the development of PEC, the project is expected to employ around 7,000 manpower during construction phase and during operations phase out 300 manpower 80% employees will be Malaysian. Local small-to-medium enterprises and companies are also set to benefit from approximately USD 1.2 million worth of construction contracts in the areas of fabrication, erection, civil work, and bulk supplies.
With an annual export turnover of USD 5 billion forecasted, PEC will play a crucial role in positioning Pengerang Integrated Petroleum Complex (PIPC) as a regional oil and gas hub and propel Malaysia further up the value chain in the petrochemical sector.
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About EXIM Bank of Malaysia Berhad
The Export-Import Bank of Malaysia Berhad (EXIM Bank) was incorporated on 29 August 1995 and is wholly-owned by the Government of Malaysia. The Bank has assisted a diverse range of Malaysian business in various sectors in their global ventures. EXIM Bank takes pride in meeting its mandated role of stimulating and enhancing the competitiveness of Malaysian industries for exports and investments globally via the provisioning of internationally and domestically competitive banking and insurance products and advisory services. The Bank also offers Shariah-compliant financing and Takaful instruments. For more information, visit www.EXIM.com.my.
MEDIA CONTACT FOR EXIM BANK
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Ronnee Osman
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E : mronneeosman@exim.com.my
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For media enquiries, please contact H/Advisors Klareco, on behalf of ChemOne Group
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Alina Morais
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Joshua Fredrick
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About Pengerang Energy Complex
Pengerang Energy Complex (“PEC”) is set to be one of the largest and most competitive integrated condensate splitter and aromatics facilities in the world. PEC is located in the Pengerang Integrated Petroleum Complex (PIPC) in Johor, at the southern-most tip of Peninsular Malaysia and directly opposite the City State of Singapore, sharing its attributes as a central trading hub and deep-water port.
PEC’s strategic location at the crossroads between buyers or product demand centres in the Asian markets and feedstock suppliers in the USA, Middle East and Australia, makes it an ideal hub for the petroleum and petrochemical industries. The resulting downstream products are used in a wide range of consumer products (textiles, bottles, housing, pharmaceuticals).
The 6.5 million metric tonnes per annum (mmtpa), facility is capable of processing 150,000 barrels per day (bpd) of condensate plus side feed of naphtha, that will in turn produce aromatics of 2.6 mmtpa, energy products output of 3.0 mmtpa and hydrogen output of 50,000 metric tonnes per annum (mtpa).The condensate splitter will produce heavy naphtha, a primary feedstock for the aromatics plant whereas the hydrogen produced is planned to be used to support development of downstream renewable fuels facilities in Johor.
The US$5.3 billion project is estimated to generate an annual export turnover of US$5 billion for Malaysia. Involving fully automated processes, the greenfield PEC has been designed to optimize energy efficiency, minimize equipment size, and significantly reduce greenhouse gas emissions in line with International Financial Corporation’s (IFC) performance standards.
Offering the latest technological advances, the world-class PEC facility will be one of the largest and most energy efficient integrated condensate splitter and aromatics facilities globally, strategically located to serve the regional Asian markets and satisfy forecast long-term sustained regional growth.
ChemOne Group, a leading energy and petrochemicals project developer based in Singapore, is the master developer for the project. ChemOne’s successful track record over the last 40 years includes managing the end-to-end, award-winning project financing for the Jurong Aromatics Complex in Singapore.
About ChemOne Group
ChemOne Group is a leading energy and petrochemicals project developer based in Singapore. ChemOne aims to be the leader in developing and operating environmentally and economically sustainable world scale state-of-the-art facilities. ChemOne’s successful track record over the last 40 years includes developing and operating several intermediate and specialty chemicals facilities across Southeast Asia.
ChemOne is currently developing a Marquee project in Malaysia, namely Pengerang Energy Complex (www.pengerangenergy.com), as well as many other large projects in multiple sectors across different geographies in Asia. The group has operations in Singapore, Indonesia, Malaysia, Thailand and China.
