Petronas said the two companies had signed an MoU for the deal yesterday, according to a report on Nikkei Asia.

The deal, if it materialises, will see CO2 emitted by factories and power plants in Japan, South Korea and Taiwan transported to areas with underwater oil and natural gas fields for storage, taking advantage of the wealth of sea floor data and existing facilities from hydrocarbon projects.

Waters off the east coast of Peninsular Malaysia are easily accessible by vessels sailing from East Asia.

The report said both parties would study potential storage sites, shipping standards and routes as well as other aspects of the project, with findings slated to be available before the year is out.

Both parties will also consider launching a joint venture.

The Nikkei Asia report, citing estimates from the Japanese Agency for Natural Resources and Energy, said the Far East archipelago needed to store 120 million tons to 240 million tons of CO2 a year by 2050 to achieve its carbon neutrality.

“The (Japanese) government aims to introduce carbon capture and storage in Japan in 2030. Reaching the 2050 goal will require developing multiple storage sites a year,” the report said.

Mitsui is already engaged in a similar feasibility study with Indonesia’s Pertamina and recently announced a similar deal with Thailand’s PPT.