PETRONAS, TotalEnergies and Mitsui Sign Joint Venture Agreement to Develop Carbon Storage Area in Southern CCS Hub

PETRONAS’ wholly owned subsidiary, PETRONAS CCS Ventures Sdn. Bhd. (PCCSV), TotalEnergies EP CCS Malaysia (TotalEnergies), and Mitsui & Co., Ltd. (Mitsui) have signed a Joint Venture Agreement (JVA) to advance the development of CO2 storage areas offshore Peninsular Malaysia, a key part of the country’s Southern Carbon Capture and Storage (CCS) Hub.

The agreement follows a series of earlier collaborations between the three partners. In 2023, they signed a Carbon Capture and Storage Development Agreement to conduct development studies and technical assessments of potential offshore storage sites. This was followed by a Key Principles Agreement in 2025, establishing the foundation for front-end engineering and design (FEED) activities and the joint venture structure.

The latest agreement marks a significant step in strengthening the partners’ collaboration to accelerate CCS deployment and support decarbonisation efforts across the Asia Pacific region. It also establishes a framework for setting up a dedicated joint venture company responsible for advancing the development, commercialisation, and operation of the CO2 storage areas.

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

The development supports Malaysia’s ambition to establish itself as a regional CCS hub by providing safe, reliable, and long-term CO2 storage solutions for hard-to-abate industries. The Southern CCS Hub is designed to accommodate CO2 from both domestic and regional sources, including potential cross-border shipments, helping industries advance their decarbonisation initiatives.

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.”

PCCSV's subsurface and project management expertise comes together with TotalEnergies' global CCS development experience and Mitsui's strengths in commercial development, project investment, and logistics. Building on these combined strengths, the partners will now focus on advancing the technical and commercial maturity of the initial carbon storage project ahead of a final investment decision.