The Carbon Capture, Utilization and Storage (CCUS) Bill 2025 was passed unanimously by both the Dewan Rakyat on 6 March 2025 and the Dewan Negara on 25 March 2025. This new legislation establishes Malaysia’s first legal framework for carbon capture activities, a significant step toward achieving Net Zero emissions by 2050.
Key Features of the CCUS Bill
The CCUS Bill introduces a comprehensive regulatory regime covering all stages of carbon capture activities:
1. Capturing carbon dioxide (CO₂) from industrial sources.
2. Transporting CO₂ via pipelines or vessels.
3. Storing CO₂ in offshore geological formations or repurposing it into commercial products like synthetic fuels or construction materials.
Key provisions include:
1. Designated Storage Sites: Offshore geological formations—such as depleted oil and gas reservoirs beneath Malaysia’s seabed are identified as primary sites for permanent CO₂ storage.
2. Licensing Regime: Operators must obtain permits for all CCUS activities, subject to environmental impact assessments (EIA), safety standards, and monitoring protocols.
3. Cross-Border Provisions: The Bill allows CO₂ transport and storage across borders, enabling regional collaboration.
4. Liability Frameworks: Clear guidelines address risks such as CO₂ leakage during storage or transit.
Malaysia’s Regional and Global Role
The CCUS Bill aligns with Malaysia’s commitments under the Paris Agreement and incorporates elements from international frameworks in countries like Norway and Canada, tailored to local conditions.
With its cross-border provisions, Malaysia is positioned as a potential hub for CO₂ storage in Southeast Asia. Its strategic location and geological assets create opportunities for multinational companies operating in the region while ensuring compliance with the new legal framework.
With the Bill now enacted into law, attention shifts to its implementation:
- Subsidiary regulations will be issued by the government to detail operational requirements such as licensing criteria, safety thresholds, and reporting mechanisms.
- Businesses engaged in high-emission activities should prepare to assess their readiness for compliance under this framework.
The CCUS Bill marks a milestone in Malaysia’s journey toward sustainable development and Net Zero emissions by 2050. While it opens doors to innovation and regional collaboration, it also introduces new compliance challenges that businesses must navigate carefully.
– By George Miranda, Joy Sam Jia Qian, Nurafiqah ‘Izzati –
This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.
