News

Investing RM600m to double production capacity


21 Jun 2010 - Emery Oleochemicals wants to fulfil industry demands By Suffian A. Bakar (suffian@bharian.com.my)

Emery Oleochemicals, the largest oleochemicals company in the world, which is jointly ventured by Sime Darby Bhd, will invest approximately RM600 million to double its production capacity in Malaysia to 600,000 tonnes from 300,000 tonnes by 2015 to meet higher demand in the consumer products industry.

Its chief executive, Dr Kongkrapan Intarajang said the five year plan involving both the oleobasics and specialised chemicals segments will see an additional plant being built on the current factory site in Teluk Panglima Garang, Selangor.

“This year, we are committed towards implementing a five year plan focusing on growth segments such as oleochemicals and specialised chemicals.

“Approval for construction of a new oleochemical plant is expected to be obtained this year and it will take about one and a half years to complete, while the plastic compound materials factory with a capacity of 25,000 to 30,000 tonnes is expected to be operational in the first quarter of 2011,” he said in an interview in Shah Alam yesterday.

Kongkrapan said the company expects that the increased capacity to double the company’s income to approximately US$1.6 billion (RM5.4 billion) in 2015 from US$800 million (RM2.7 billion) currently.

Emery Oleochemicals, a joint-venture between Sime Darby and Thai PPT Chemical Public Co Ltd, has a production capacity of one million tonnes via its three factories in the European, American and Asian market.

“It supplies oleochemicals to the consumer products industry which is expanding, driven by higher demand especially in India and China.

Kongkrapan said the decision to build the new factory was a result of uncertainties surrounding the success of discussions with Kulim Bhd on the proposal to take over an oleochemical plant owned by Kulim in Johor.

The Kulim oleochemical plant in Pasir Gudang is capable of producing 380,000 tonnes of fatty acids, 7,500 tonnes of methyl esters and 47500 tonnes of ‘soap noodle’

AmResearch, in its report recently valued the oleochemical business of Kulim between RM291 million to RM312 million.

Kongkrapan added that some of the research and development activities which are now focussed in the US and Europe, will be brought into this country as part of the five year plan.

“This year, we are committed towards implementing a five year plan focusing on growth segments such as oleochemicals and specialised chemicals.” added Kongkrapan Intarajang, Chief Executive Emery Oleochemicals

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