UP ties up with Fuji Oil to build RM145mil plant
Plant to produce and sell high value-added palm oil fractions
PETALING JAYA: Plantation group United Plantations Bhd (UP) has formed a joint venture (JV) with Japan-based Fuji Oil Group to build an RM145mil high-tech palm oil processing plant in Ulu Bernam, Perak.
According to UP chief executive director Datuk Carl Bek-Nielsen, Unifuji Sdn Bhd, a 50:50 JV company between UP and Fuji Oil’s subsidiary Fuji Oil Asia Pte Ltd, will manage the new plant which will produce and sell high value-added palm oil fractions.
The plant is slated for commission by June next year.
On financing, Bek-Nielsen told StarBiz: “As this is a JV, the cost will commensurate between both Fuji Oil and UP.
“UP has adequate liquidity available to fund its share of the project from its internal funds, which also applies to Fuji Oil.
“We will decide on how to optimise this in due course,” added Bek-Nielsen.
Both companies have decided to build the high-tech plant in UP’s Ulu Bernam estate, which is in a rural area, as “we feel that companies also have an obligation to help promote employment to Malaysians who live in rural areas and not just in urban dwellings,” he explained.
Operation-wise, Bek-Nielsen said the raw materials for the high-tech plant would only be sourced from UP estates.
“It is important to note that every drop of palm oil used for this project will be certified sustainable palm oil in accordance with the Roundtable on Sustainable Palm Oil criteria and earmarked for export markets including the European Union.”
Furthermore, the JV partners have also agreed that Unifuji would only employ Malaysians at the proposed new plant, said Bek-Nielsen.
More importantly, the JV company would be providing modern housing facilities for its employees including free water, free electricity and free medical facilities that will also be completed early in the new year.
This is to ensure all employees for the new project will be given first class housing facilities, which is in line with the UP trademark.
On the rationale for the JV between Fuji Oil and UP, Bek-Nielsen said: “This is to build on each company’s more than 100 years of commitment towards sustainability, quality and innovation.”
“There is no doubt that the demands of the global consumer just gets stricter and stricter and in that connection we feel that there is long term value in striving to raise the benchmark to new levels of sustainability and quality.
“I remain supremely confident that we can achieve this and show that palm oil can be the best in class when it comes to minimising carbon foot print vis-a-vis all the other oils and fats,” he added.