Process engineering firm Lipochem built this biodiesel plant for the company, Carotino.

Malaysia is not only exporting palm oil, but also all the expertise that goes into processing and refining the oil.

THE good fortune enjoyed by the palm oil industry is not just confined to those who grow the trees, but also to those involved in designing and fabricating the equipment needed to process and refine crude palm oil (CPO) into value-added products.

Lots of refineries have been built to separate palm oil into its various fractions, with palm olein (used for cooking oil) being the most prized component. The same goes for the processes involved in the production of a host of value-added products like margarine, confectionery, soap, detergent, candles, cosmetics and so on.

The latest would be the use of palm oil in the production of biodiesel, through two chemical reactions called esterification and transesterification. This involves inducing a reaction between vegetable oils or animal fats and short-chain alcohols (typically methanol or ethanol). The process is relatively straightforward, and in the United States, many backyard biodiesel plants proliferated after fuel prices rose to unacceptable levels for some.

However, Malaysia is going down the path of large plants, and discourages the setting up of backyard biodiesel operations on account of public safety. The only exception in favour of small scale players is if the plant is designed to extract phytonutrients (like vitamins) from CPO, and biodiesel is produced as a by-product. At the turn of the millennium, biodiesel manufacturing received a huge boost, when the private sector, with the encouragement of the government, started building dozens of biodiesel plants, firstly with the aim of soaking up excess stocks of CPO, and later on, to profit from the euphoria over biofuels as a greener fuel.

The need to build plants is good news for local engineering firms like Lipochem, which has been in the business of process engineering for the past decade.

Managing director Koh Pak Meng said his company was engaged by the Malaysian Palm Oil Board (MPOB) as a consultant to build biodiesel plants based on the board’s proprietary technology in 2005. The other company is Oiltek, and these two companies are exporting technology for normal (non-winter use) first generation biodiesel plant using refined oils as feedstock.

The current mad rush by Indonesia to scale up its palm oil processing industry is ensuring that companies like Lipochem has a bright future, as well as creating a healthy demand for experienced chemical engineers. Chemical engineers play a key role in the field of process engineering, which is about optimising the production process so that it produces the highest amount of value-added products while using the least amount of energy and water.

Process engineering is the new golden field as the downstream part of the palm oil industry flourished. - KOH PAK MENG, MANAGING DIRECTOR OF LIPOCHEM

As a pioneer in palm biodiesel process engineering, Lipochem built the world’s first integrated palm biodiesel plant in 2006 for the company, Carotino, in Johor. Its global ambitions also saw it completing a biodiesel plant in South Korea for Enertech in 2007.

“To date, we have built seven large plants in Asia and our capabilities allow us to build plants with capacities of up to 120,000 tonnes per year,” said Koh.

In recent years, process engineering has become the new golden field as the downstream part of the palm oil industry flourished. “Every process engineer is fighting for a piece of the action in the plant building pie in Indonesia right now”, said Koh, who added that present-day clients, including those based in Indonesia, recognise the importance of capitalising on a highly efficient process, and not just on plant capacity.

“Clients now want very large refineries that are also energy and water efficient. While increasing capacity, our engineers improve the process by reducing water usage and stepping up on heat recovery,” said the Britain-trained Koh, who founded Lipochem in 2001 after assembling a team with more than two decades of experience in process design and engineering.

Clients also demand that the plants be fully automated, and robust, so as to reduce down time. “Refiners cannot tolerate any breakdown as each day of down time means losses of tens of thousands of dollars at current palm oil prices. And on top of that, an engineering company must be able to deliver results quickly. For example, we have delivered a refinery in Sumatra on a fast track basis, which the client said must be up and running in 10 months,” said Koh.

It is evident that Malaysia is not just an exporter of palm oil, but also all the expertise that goes into processing and refining the oil. Koh recalled that when the palm oil downstream industry was at its infancy, every single piece of plant equipment had to be imported.

“We’ve come a long way since. Malaysia is no longer just a commodity exporter. We are helping in the export of government-funded technology.”

Plant upgrades

ANOTHER growth area is in the retrofitting of older or conventional biodiesel plants that were originally designed to take only refined palm oil as feedstock, into those that can accept a diverse range of feedstocks.

“The future is biodiesel production using waste oil and multiple feedstock sludge, including low-cost feedstocks such as used cooking or frying oil, waste oils, sludge palm oil and palm fatty acid distillate. To improve the profitability of the biodiesel business, we must look at multi-feedstocks now, especially when CPO price is too high,” said Lipochem managing director Koh Pak Meng.

Lipochem has developed the second generation biodiesel technology which is multi-feed, and can also process rapeseed, jatropha and soya oils.

Currently, there are a dozen idle single-feedstock biodiesel plants in Malaysia, which failed to take off on account of the unexpectedly high price of palm oil. Other than converting them into multi-feedstock biodiesel plants, these plants could also be modified to be biochemical plants for the extraction of phytonutrients and other valuable components from palm oil.

According to Koh, the move towards renewable energy is ensuring that there will be a bright future in chemical engineering. “There are many more areas to be explored in process engineering now, unlike in the past, when chemical engineering students here could only do their industrial training at Petronas, Shell or Esso (undergraduates can now intern at Lipochem as well). For example, fast pyrolysis is one of the potential gateways to the production of the more sustainable second generation biofuels from renewable biomass, and it is looking increasingly feasible. And the quality of bio-oil (from biomass) is now good enough to be fired directly in burners and boilers.”

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