Johor Plantations Group (JPG) will use funds raised in its $156,357 million initial public offering (IPO) to build a palm oil operation powered by clean energy, as it navigates increasingly tough regulations in key markets such as Europe.

The mid-sized palm oil producer is confident about appealing to European consumers thanks to its short, sustainability-certified supply chain and plans to halve its carbon output by next year, managing director Mohd Faris Adli Shukery said ahead of the listing.

Growers of the world’s most-consumed edible oil are facing heightened global scrutiny over their devastating impact on tropical rainforests, with the most immediate pressure coming from the European Union Deforestation Regulation. Due to come into effect by the end of the year, the law forces companies selling commodities such as palm oil and cocoa to make sure their products do not come from recently deforested land.

Malaysia is the world’s second-largest palm oil producer and Europe is among its biggest export markets.