Petronas Advance Plastic Recycling Collab Raises Its ESG Value

Petronas Chemicals Group and ExxonMobil potential collaboration for large-scale implementation of advanced plastic recycling technology is seen as an important step in developing a sustainable circular economy.

The collaboration is crucial to the transition into the circular economy as PCG had planned for the petrochemical industry while tackling the feasibility of plastic recycling in the long run. Apart from waste management and advanced recycling, PCG had also initiated solutions for green and specialty chemicals (see “PCG to tap into specialty chemicals with Perstorp”, 19 May 2022) for more sustainable petrochemical products in the future.

Exxon is a founding member of the Alliance to End Plastic Waste (AEPW) with the objective to accelerate investment in safe, scalable, and economically viable solutions in addressing plastic waste management. Exxon had plans to build its first large-scale plastic waste advanced recycling facility with a capacity of 500,000 MT per year by end of 2026 across multiple locations globally. PCG’s parent company PETRONAS had been in collaboration with Exxon in the past, with its prior MoU signed in 2021 for a joint exploration of opportunities in carbon capture and storage (CCS) technologies to aid in decarbonising Malaysia’s upstream subsector and provide storage solutions for CO2 in the region.

Petronas was Exxon’s ninth MoU in CCS since establishing its Low Carbon Solutions business. No changes to earnings estimate. Considering that the MoU is still in its early stages, we make no changes to our earnings estimates.

MIDF maintains a BUY call on the stock with the target price of RM11.93 per share. as it sees the initaitie positivelty from ESG stand point.

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