Foreign group to build $1.4b pulp mill in Malaysia
Foreign group to build $1.4b pulp mill in Malaysia
KUALA LUMPUR (AFP): A subsidiary of Malaysia's Ekran Bhd. has
picked a foreign consortium to build its proposed 3.5-billion
ringgit ( US$1. 4 billion) pulp and paper mill, a report said
yesterday.
The agreement will be signed next month with the group,
comprising companies from the United States, Brazil and Europe,
Ekran executive chairman Ting Pek Khiing was quoted as saying.
"The consortium will be responsible for commissioning and
operating the plant," The Star newspaper quoted him as saying.
The plant would be based in Bintulu, in resource-rich eastern
Sarawak state.
The foreign consortium had "undertaken many projects in other
countries such as Indonesia," he said, adding that the name of
the group will be announced later.
The project developer, Sarawak Pulp and Paper Mill Sdn. Bhd.,
is wholly owned by Ekran's listed subsidiary, PWE Industries
Bhd., following the pullout of Indonesian conglomerate RGM
International.
RGM International had previously held a 55 percent equity
stake in Sarawak Pulp and Paper Mill and PWE the remaining 45
percent stake.
"The project is now 100 percent owned by PWE. Construction
will start in early January," Ting said.
"From my experience with Bakun (a massive hydroelectric dam
project in Malaysia), I think it is better for such an
undertaking to be handled by only one company," he added.
Ting said the mill will be commissioned in the last quarter of
1998, with raw material coming from trees to be felled at the
Bakun dam project, 100 kilometers (68 miles) from Bintulu, a
coastal town in Sarawak.
Ting's Ekran holds a controlling 32-percent stake in Bakun
Hydroelectric Corp. Bhd., the developer of the 13.6-billion-
ringgit dam in Sarawak. Work on the dam started on December 1 and
is scheduled to be completed by 2003.
About 1.5 million tons of wood will be needed to produce 1.2
million tons of pulp annually, Ting said.
Ting said the company had found buyers for the produce over
the next 10 years. "We expect to record 1.5 billion ringgit in
sales per year," he added.
Ekran stock was 30 sen lower at 10.20 ringgit while PWE
Industries dropped 25 sen to 37.75 ringgit in late morning
trading on the local bourse Friday.