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Biomass pellets manufacturing plant in Johor seeking RM22 mil to expand production capacity.

Biomass pellets manufacturing plant in Johor seeking RM22 mil to expand production capacity.

Executive Summary:

1) This project is a design and built for 2 production lines of Biomass Pellet Mills.
2) Total production capacity is 20 TPH or 10,000 TPM or 120,000 TPY.
3) Raw materials are wood and palm oil waste.
4) Total investment is RM 22 million including factory.
5) Total annual revenue is estimated RM 40 Millions to 60 million.
6) The ROI is estimated 2.2 years (including 9 months factory set up).

Project Status:

1) This project has been obtained GTFS certificate from Malaysia Green Technology Corporation by KETTHA.
2) This project is categorised pioneer status by MIDA.
3) Factory location has been identified.
4) Machinery Suppliers have been identified
5) Raw Material Suppliers have been identified

Company Background

xxx Sdn Bhd is founded in 2011. Company is located in the biggest palm and wood industry state, Johor. xxx initially has set up its pilot plant in Pontian, Johor. After 2 years of research and development on pelletisation technology, xxx has successfully completed and predominated the entire process, started from the collection of wood and palm waste, screening, drying, grinding, and packaging. Finally, xxx is capable to produce wood pellets and palm pellets.

Next, xxx is currently planning to expand its production capacity to 20 tons per hour or ten thousand tons per month. The project has been recognised by Energy, Green Technology and Water Department (KETTHA) Malaysia and obtained Green Project Certificate under Green Technology Finance Scheme (GTFS) issued by the Malaysian Green Technology Corporation. With this project commenced, xxx will be able to reduce significantly the agricutural waste, to provide long-term supply of biofuel energy fulfilling the industrial needs,
creating value for its customers as energy-saving solutions provider, while creating a clean, low-carbon environment. Subsequently, xxx will become the leading biomass pellet fuel provider in Malaysia .

International Demand :

1) Asia – China
• September 12, 2013 the State Council has issued the “Air Pollution Prevention Action Plan” and clearly stated to accelerate the adjustment of energy structure, improve the proportion of clean energy and control the total coal consumption.
• Target : Reduce the proportion of coal consumption to total energy to 65% or less.
• The industrial heating is the main energy market, there are currently more than 50 million units of small coal-fired boilers (>20 tons) and the annual coal consumption is 270 million tons. The 30% of consumption is accounted for an estimated 80 million ton solid fuel.

2) Asia – Korea

• South Korea has adopt Renewable Portfolio Standard, RPS. 14 public and private electric utilities company MUST, at the time in 2015, using a 4% share of renewable energy sources, and then gradually increase to 10% in 2022
• In addition, South Korea will allow to import palm oil biomass due to limited wood pellet sources in September.
• The total consumption in 2022 is estimated 19 million tons as below.

3) Asia – Japan

• Since the nuclear accident occurred at Fukuda, Japan has been actively developing renewable energy projects.
• In July 2012, Japan has began the energy buyback program – Feed in Tariff (FIT), to subsidise and develop various renewable energy.
• For electricity generated by biomass, the FIT price is set from 13.65 to 40.95 yen / kWh for a 20-year contract,
• The main market is industrial heating.
• Japan’s current demand of biomass is one million tons and its demand is estimated will reach three million ton in 2015.

4) Europe

The European Union member agreed to a 20% binding target for renewable energy (including 10% from biomass) by 2020 as well as a 20% reduction in greenhouse gas emissions in March 2007. The potential pellet quantities required from 10 million p.a. (2010) to 90 million p.a. (2020)


• Malaysia adopted the “Five-Fuel-Policy” with Renewable Energy as the 5th Fuel for Power generation in 2000.
• Small Renewable Energy Power (SREP) Programme was started in 2001 covered Biomass, Biogas, Landfill Waste, Mini-Hydro.
• National Renewable Energy Policy and Action Plan (2009)
• Renewable Energy Act (2011) & Sustainable Energy Development Authority Act SEDA (2011)
• Feed in Tariff (FiT) Programme – To encourage building of power plant including Biomass Power Plant Malaysia Energy Policy – 5th fuel Policy

Local Demand:

• The total power generation by Biomass 2015
= Commissioned plant + Plant in progress
= 43.4 + 91.0
= 134.4 MW
Hence, all plants require >500,000 ton wood Pellet annually > 40,000 ton wood Pellet per month.
Assume RM300/ton, Potential Business Value >RM 150,000,000 OR 150 mill annually >RM 12,500,000 OR 12.5 mill per month Not Including factories which needs heating for steam and hot water! E.g. Glove Manufacturer, Chemical Plants, and etc !

Advantage of proposed location:

1) Very close to raw materials sources。
2) Located center of southern johor.
3) Raw material supplies are within 50 km.
4) Palm oil waste is estimated 20,000 ton per month
5) Wood waste is estimated 3,000 ton per month
6) Located center of 2 sea ports.


CHEK Chong Posted on 9:01 am - 20/12/2016

Hi Sir, I am interested in the Biomass Pallet plant. Can you please keep in touch with us?
CHEK Chong

Larry Posted on 9:33 am - 31/12/2016

Please contact me. Dato Larry Liew.
I need to know more.

Abdul Salam Khan Posted on 4:33 pm - 21/04/2017


You still looking funder ? please contact to me..

Sam Khan

Fakhrul Nazrin Posted on 5:41 pm - 19/09/2018

Hi sir. Our company are looking for Solid Biomass Wood Pallet. Could you please give us the prices including the transportation to United that located at Bangi.

Patrick Posted on 9:54 pm - 01/11/2018

I am interested in your plant and wood pallets. Would appreciate if you could contact me at LPAMGT@GMAIL.COM.