Eight strategies have been identified to ensure that all aspects of Brunei Darussalam’s development are being implemented systematically and effectively. Areas covered include education, economic development, local business development and environment strategy to ensure the accomplishment of the goals of Brunei Vision 2035.
In the area of energy, three strategic goals area addressed: (1) strengthening and grow oil and gas upstream and downstream activities; (2) ensuring the safe, secure, reliable and efficient supply and use of energy; (3) maximise economic spin-offs from the energy industry. This includes for example a significant increase in local participation in the country’s total workforce.
Ten key performance indicators (KPIs) have been developed to address needs across the different segments and parts of the value chain in the energy sector. An initial set of supporting initiatives has also been identified to ensure that the energy sector delivers its targets by 2035.
Four key enablers have been identified to ensure that Brunei grows in a manner that is competitive and sustainable: (1) including implementing supportive policy and regulatory frameworks; (2) growing Bruneian human capital; (3) attracting investment to fuel growth; (4) ensuring delivery on commitments.
The Ministry of Energy, Manpower and Industry (MEMI) was formerly a department under the purview of the Prime Minister’s Office. It was initially formed in 2010 as the Energy Department, Prime Minister’s Office. In October 2015, the Department expanded its portfolios to include the industry sector and subsequently became known as the Energy and Industry Department, Prime Minister’s Office (EIDPMO).
His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar ‘Ali Saifuddien Sa’adul Khairi Waddien, Sultan and Yang Di-Pertuan of Brunei Darussalam consented to elevate the Energy and Industry Department to ministry status (it was renamed the Ministry of Energy and Industry) effective April 18, 2018.
The monarch shortly after consented to change the name of the Ministry of Energy and Industry to the Ministry of Energy, Manpower and Industry effective July 31, 2018.
MEMI’s vision is “Sustainable, Diverse and Resilient Economy for the Prosperity of Our People”, while its mission is “to accelerate and enhance economic growth, underpinned by conducive environment and industry-ready workforce”.
Its three strategic goals are “to strengthen and diversify our economy; nurture conductive business environment; and create and develop an industry-ready local workforce”.
According to the BEDB, Brunei has nearly 90 years’ experience in the oil and gas industry, where it has developed significant expertise and strength, particularly in the upstream sector and liquefied natural gas (LNG). In comparison, the sector’s downstream industries are still in their early stages in terms of development and maturity.
In May 2010, a methanol plant was commissioned and began exporting its products within the region, with future plans in store, including further developing the downstream industries to generate economic growth, create employment for locals and spur other spin-off industries. Brunei’s first fertiliser plant is under construction, expected to be completed in 2021. The plant will produce up to 3,900 tonnes of urea per day.
Meanwhile, construction of an integrated refinery and petrochemical complex at Pulau Muara Besar (PMB) has started and is scheduled for completion by June 2019. The facility will be producing refined petroleum products such as gasoline, diesel and jet fuel, as well as downstream petrochemicals such as benzene and paraxylene.
Brunei’s current target for downstream economic output is to achieve BND5 billion per year by 2035.
Brunei welcomes foreign direct investment (FDI) in the downstream sector, including those that can create cross-sectoral opportunities by utilising feedstock from existing and future petrochemical plants to manufacture value-added derivatives, which hold the positive potential of leading to further spin-off opportunities.
Compounds such as methanol, ammonia and urea (from the country’s existing methanol plant and future ammonia-urea plant) can be used as feedstock to manufacture derivatives such as methylamine, formaldehyde, polyoxymethylene (POM), etc, which can promote opportunities in the manufacturing of wood-based products, tableware, plastics, textiles and other items.
In order to support the development of potential downstream industries, two dedicated industrial sites have been allocated and reserved, namely Sungai Liang Industrial Park (SPARK) and Pulau Muara Besar (PMB) Industrial Park.
These sites provide new projects the benefit of proximity to existing and future petrochemical plants so as to achieve cross-industry synergy and optimise logistical efficiency.
Speaking at the 14th Legislative Council session in March 2018, Minister of Energy, Manpower and Industry Yang Berhormat Dato Seri Setia Dr Awang Haji Mat Suny bin Haji Mohd Hussein said that the management of the country’s hydrocarbon resources and the regulations governing it will from henceforth be implemented more effectively and in a more orderly manner.
He said in moving towards economic diversification, MEMI will work together with other ministries and relevant authorities to develop high-demand sectors and fields.
One of the significant developments of 2018 was the commencement of construction of the world’s first global hydrogen supply chain demonstration plant at a project site located at Sungai Liang Industrial Park (SPARK).
The plant is a part of a two-phase project (comprising the aforementioned Sungai Liang hydrogenisation plant and a dehydrogenisation plant in Kawasaki, Japan) between the governments of Brunei and Japan under the Advanced Hydrogen Energy Chain Association for Technology Development (AHEAD), a consortium of four leading Japanese companies – Chiyoda Corporation, Mitsubishi Corporation, Mitsui & Co Ltd, and Nippon Yusen Kabushiki Kaisha – and funded by the New Energy and Industrial Technology Development Organization (NEDO).
It was reported following the ground breaking ceremony for the plant construction on April 21, 2018 that the plant is a direct response to growing global concerns on greenhouse gas emissions and the adverse effects these emissions have had on the planet as outlined in the Paris Agreement.
The construction of the demo plant represents a boost in bilateral relations between Brunei and Japan in terms of investments in the next generation of clean energy alternatives.
Ambassador of Japan to Brunei, Motohiko Kato said of the collaboration, “Backed by Japanese technology as well as support from the Bruneian Government and Japan, Brunei will enter a new era of environmentally friendly energy that will sustain the future generation.”
He added that the project will also help establish further ties between Brunei and Japan, and provide Brunei the opportunity to take advantage of hydrogen to preserve its pristine environment.
“I hope the bright young students at Universiti Brunei Darussalam (UBD) and Universiti Teknologi Brunei (UTB) will be inspired by this project and consider how they can contribute to hydrogen energy use in Brunei,” Kato said.
Also speaking at the event was Masayoshi Yamakage, Director of Advanced Energy Systems and Structure Division, Energy Conservation and Renewable Energy Department, Agency for Natural Resources and Energy, Ministry of Economy, Trade and Industry (METI) of Japan.
Yamakage noted that the Paris Agreement has encouraged the decarbonisation of the global energy sector, adding that hydrogen represents a key technology to realise this transition. He also shared that the Japanese Government formulated a ‘Basic Hydrogen Strategy’ in December last year, and said that this project is very important in realising a “hydrogen society”.
“For Brunei, this involves taking advantage of its rich natural resources and making use of Japan’s hydrogen technology to create a harmonious relationship,” he said. “The success of this project is dependent on the close cooperation between Brunei and Japan, and realising this innovation is the first step towards a hydrogen society focused on promoting global decarbonisation.”
Deputy Minister of MEMI Dato Seri Paduka Awang Haji Matsatejo, the guest of honour at the plant ground breaking, gave his backing to the hydrogen energy project.
“I would like to encourage the use of hydrogen fuel, especially in the transportation sector, and encourage the involvement of educational institutions to promote and raise awareness of this fuel,” he said. “The world is still far away from adopting hydrogen as a mainstream energy source, but there is no reason why Brunei cannot be one of the pioneers in the development of this clean energy system.”
The demo plant is scheduled to be completed in September 2019, with operations to begin by 2020. Hydrogen will then be transported in liquid form by ship to Kawasaki, Japan for a year. Once in Kawasaki, hydrogen gas will be extracted from the liquid and supplied to consumers.
More information about the project was shared by AHEAD President Hideki Endo during an interview.
“AHEAD has invested more than USD100 million in the setting up, and subsequent running of the operations and management of the demo plant here in SPARK,” Endo said. “The plant represents an example of the drive to mass produce hydrogen for a greener future for the next generation.”
He cited the various companies that have contributed technologies for the project, including hydrogen handling expertise from Chiyoda Corporation and Mitsubishi Corporation, and ocean transportation capabilities by Nippon Yusen Kabushiki Kaisha, among others, adding that these companies and operational processes form part of the supply chain outlined in the proposed project.
Endo also noted that while the SPARK plant is still a new project, AHEAD already has a small local workforce to help ensure its smooth construction and operation. The consortium, he added, is currently in discussions to further increase the local workforce involved in the oneyear project.
The plant is slated to be in operation for one year – from January to December of 2020. Speaking on the future plans for the plant beyond 2020, Endo commented, “We are expecting to have a commercial or semi-commercial supply chain, but it will have to depend on the marketability of hydrogen in the future. Currently there are 3,000 fuel cell vehicles being operated in Japan alone.”
He explained, however, that though hydrogen consumption from fuel cell-driven vehicles is low at present, the main consumer of hydrogen will most likely be power generation companies which supply electricity to the population.
AHEAD’s decision to choose Brunei as the first site for the demo plant, was due to the proximity between Brunei and Japan, and the availability of natural resources here in the country is also another factor.
On the plant’s ability to produce hydrogen from energy sources other than crude oil, the AHEAD president said, “While the demo plant is designed to primarily convert fossil fuel into hydrogen, the gas can also be extracted from natural gases as well as by-products produced from certain manufacturing processes.”
“It is possible with hydrolysis technology to convert renewable energy into hydrogen as well – this is another avenue for hydrogen production,” he added.
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