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Identifying climate risk for one of the largest Aromatics plants in the world

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In 2020, a world-class Aromatics complex operator engaged ESC to conduct a Climate Change Risk Assessment to understand the future climate-related hazards and potential impacts of its proposed Pengerang Energy Complex (PEC) in Malaysia. 

About the Project

The client plans to develop and operate one of the world’s most energy and resource-efficient aromatics plants on a 250-acre site in the Pengerang Integrated Petroleum Complex (PIPC) in Johor, Malaysia.


The climate change risk assessment developed by ESC sustainability & climate change consultants aims to evaluate baseline climate conditions derived from secondary data and to identify potential impacts and natural hazards associated with the project based on the possible changes to the local and global climate conditions.

Our Approach

Investments in the oil & gas sector are typically vulnerable to numerous climate impacts ranging from intense and frequent extreme weather events to gradual permafrost melt. These impacts pose a risk to companies and could result in substantial losses if risk management plans, asset design and construction, and management-level decision-making are not incorporated. 


Based on the project’s publicly available data and findings from Environmental Impact Assessment (EIA) and Environmental, Social, and Health Impact Assessment (ESHIA) studies, ESC developed the climate change risk assessment and evaluated the project’s existing climate conditions and anticipated impact of global warming throughout the project’s lifecycle. 


ESC used the IFC Performance Standard on Environmental and Social Sustainability, the Equator Principles, and the Malaysia National Policy and Planning Framework to develop mitigation strategies for addressing climate-related risks and creating a sustainable energy hub for Malaysia. 

ESC took the following steps in conducting the climate change risk assessment: 


  • Studied the historical data to find out what natural hazards are out there and how they might affect the built and natural environments. 
  • Reviewed climate change model projections to see how climate variables might change in the future and how they may affect business operations.
  • Evaluated the risk posed by each climate hazard to the project and its facilities. 
  • Recommended mitigation and monitoring measures to reduce risks. 
  • The project owner implemented the strategy and, if necessary, adjusted their operating procedures or activities to reduce unavoidable impacts to acceptable levels.


PEC gained a better insight into their climate-related risks and opportunities and used the study’s findings as a roadmap to develop mitigation and adaptation strategies. Through our climate risk services, ESC determined that climate change will not undermine the goals, objectives, and outcomes of the proposed PEC complex and that the project’s development is appropriate, viable, and sustainable in the face of climate change.

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