SERVICES: KLEAN INDUSTRIES TRANSFORMS MALAYSIA’S TYRE PYROLYSIS CHALLENGES INTO A GLOBAL BLUEPRINT FOR SUCCESS

Sustainable Development Goals

Project Status:
DECOMMISSIONED | Completed 2017 
Organizations Involved:
Advance Pyrotech, KK Incinerator Eng. & Const., L&S Trading, Menanjung, Worley Parsons
Services:
Due Diligence, Feasibility Studies, Supply Chain Management, 

Introduction:

Malaysia generates over 32 million end-of-life (EOL) tyres annually, presenting a significant opportunity to lead Southeast Asia in sustainable tyre recycling and resource recovery. Initial attempts within the industry aimed to capitalize on this opportunity, but often lacked the necessary engineering expertise, economic analysis, and proven technologies required for success on a large scale.

Klean Industries was engaged to evaluate and eventually decommission one of the region's largest tyre pyrolysis plants due to significant operational challenges. Instead of perceiving this situation as a failure, Klean transformed it into a valuable case study. They turned critical lessons learned into a refined blueprint that now informs successful projects worldwide.

The Challenge

In the early 2000s, Octagon Consolidated Berhad (OCB) and its subsidiary Advance Pyrotech Sdn Bhd launched one of Malaysia’s most ambitious tyre recycling projects in the state of Melaka. The plant, co-developed with KK Incinerator Engineering, was designed to process 60 metric tonnes per day of waste tyres using a continuous pyrolysis system, with plans to expand to 120 tonnes per day.

The initial US$25 million raised to build the facility aimed to produce pyrolysis oil, carbon char, and gas fuel alongside environmental credits and was among the first in Asia to attempt full-scale, continuous thermal treatment of tyres.

However, as with many early pyrolysis ventures, the project was plagued by common pitfalls:

  • Unsecured Feedstock: The project lacked guaranteed long-term feedstock supply agreements and relied heavily on imported tyres, which were often undervalued and contaminated.
  • Unproven Technology: The pyrolysis system, although theoretically viable, had never been scaled beyond small-batch trials and proved incapable of continuous operation at commercial volumes.
  • Engineering and Cost Overruns: Design changes, execution gaps, and unanticipated operational issues resulted in delays and unsustainable increases in capital expenditures.
  • Limited Product Marketability: The carbon char had no clear upgrading strategy, and the pyrolysis oil lacked refining or offtake agreements, further destabilizing revenue forecasts.
  • Regulatory Gaps: A lack of clear permitting pathways and post-market oversight compounded the project’s technical challenges.

By 2014, Octagon entered receivership, and the plant was permanently shut down.

The Solution

In 2017, Klean Industries was invited by Malaysia’s Insolvency Department to assess the failed project and advise on recovery pathways. With decades of experience in pyrolysis system design, EPC execution, and project turnarounds, Klean undertook a comprehensive feasibility study to evaluate all technical, environmental, and financial aspects of the plant.

Upon review, Klean concluded that the legacy technology and plant design were fundamentally flawed and unsuitable for recommissioning. Instead, Klean led the professional decommissioning of the facility, removing all equipment from the site to make way for future development aligned with international best practices.

Most importantly, Klean used the Melaka project as a learning milestone not only for Malaysia but for the entire global tyre recycling sector. The company published key insights, updated internal risk protocols, and refined its development framework for future tyre-to-fuel and recovered carbon black (rCB) projects.

The Outcome

Although the original project could not be salvaged, its deconstruction and analysis paved the way for more resilient tyre pyrolysis developments throughout Southeast Asia and beyond. Today, Klean is leveraging these insights to lead successful projects in markets such as Japan, Vietnam, the United States, and the European Union.

Klean's refined approach includes:

  • Guaranteed Feedstock and Offtake Contracts before project financing
  • Commercial-Scale Technology deployed in over 20 global facilities
  • Detailed Feasibility, HAZOP, and EPC Oversight before construction
  • Advanced Carbon Upgrading & Oil Refining Systems designed for market-readiness
  • Integrated Permitting and Policy Alignment to de-risk regulatory delays

Leadership Insights

Projects like Melaka offer valuable industry-wide insights. While the original developers were early pioneers, their challenges highlighted the critical importance of experienced execution, proven technology, and end-to-end system design.

Klean Industries doesn’t just deliver equipment—we provide certainty. Our turnkey solutions are built on decades of real-world data, third-party validation, and scalable performance. Whether revitalizing legacy infrastructure or developing next-generation circular projects from the ground up, Klean leads with integrity, transparency, and unmatched industry expertise.

This case study serves not as a story of failure, but as a catalyst for more innovative development, stronger policy frameworks, and a cleaner, more circular future for Malaysia and the world.

Learn more:

Why Klean Industries is the Best Choice for Tyre Pyrolysis & Circular Economy Projects

Klean Industries has successful pyrolysis technology that operates at scale. Learn how we can help you avoid costly mistakes and effectively develop a tire pyrolysis plant that delivers real financial and environmental results.

Why Klean is the Global Leader in Tyre Pyrolysis:

  • ✅ Over 20 Years of Industry Experience: Leading commercial tyre pyrolysis projects worldwide.
  • ✅ Advanced Pyrolysis & Carbon Upgrading Technology: Producing high-quality recovered carbon black (rCB) and low-carbon fuel oil.
  • ✅ Guaranteed Feedstock & Offtake Solutions: Helping clients secure long-term supply and buyer contracts before project launch.
  • ✅ Financially Bankable Projects: Engineered for strong ROI, scalability, and compliance.
  • ✅ Global Track Record of Success: Trusted by industrial leaders, engineering partners, government agencies, and investors.

If you would like to learn more about this project, please get in touch with us now >> GO.

This project addresses the United Nations Sustainable Development Goals (SDGs) by considering the goals and associated targets illustrated by the WBCSD’s Tire Industry Project (TIP). TIP provides a framework for action that outlines impactful pathways for the tire sector to contribute to achieving the Sustainable Development Goals (SDGs). To learn more about how Klean's approach, solutions, and technologies contribute to advancing the SDGs, please review the report "Sustainability Driven: Accelerating Impact with the Tire Sector SDG Roadmap." See: https://www.wbcsd.org/Sector-Projects/Tire-Industry-Project/End-of-Life-Tires-ELTs