KUALA LUMPUR: Abu Dhabi’s Mubadala Development Company’s unit Masdar and 1Malaysia Development Bhd (1MDB) are teaming up to explore clean technology projects and investments, including the possibility of building Malaysia’s first carbon-neutral city.

Masdar and 1MDB also intend to cooperate and invest in carbon reduction projects, under the Kyoto Protocol’s clean development mechanism (CDM) and clean technology venture capital.

In a joint statement yesterday, the parties said if fully implemented, the agreement would lead to the development of new catalytic projects, with an estimated value of US$100 million (RM334 million).

The agreement with Masdar was signed during Prime Minister Datuk Seri Najib Razak’s visit to Abu Dhabi. The agreement will enhance Malaysia’s efforts to embrace world-class sustainable practices and clean technology. It was among several strategic joint agreements signed between Malaysia and the UAE.

Masdar CEO Dr Sultan Ahmed Al Jaber said it was committed to building strategic partnerships and creating worldwide networks in the push for new low carbon energy technologies and clean, sustainable ways of living.

“We value this partnership with Malaysia and applaud their move to actively pursue and invest in new green technologies,” he said.

1MDB CEO Shahrol Halmi said clean technology was an increasingly important sector for the future economic development of Malaysia.  He added the partnership with Masdar would help expose Malaysia and 1MDB to world-class capabilities in sustainable development.

Shahrol does not rule out the possibility of 1MDB building Malaysia’s first carbon-neutral city. “It is our intent to explore and evaluate business opportunities relating to the development of an environmentally friendly carbon-neutral city in Malaysia,” he added.

Masdar, set up by the Abu Dhabi government in 2006, is a renewable energy initiative that integrates the fully renewable and clean technology life-cycle to create commercially scalable renewable and clean energy solutions.

1MDB is mandated to drive strategic initiatives for long-term sustainable economic development and promote inflow of foreign direct investment into Malaysia.

This article appeared in The Edge Financial Daily, January 19, 2010.