RI and Malaysia set up oil palm joint venture

RI and Malaysia set up oil palm joint venture

KUALA LUMPUR (Reuter): Malaysian and Indonesian companies will develop 64,000 hectares of oil palm estates and processing industry in Kalimantan.

Malaysian plantation group Austral Enterprises Bhd has entered into a joint venture with PT Pontimakmur Sejahtera of Indonesia to develop 30,000 hectares of jungle land in Indonesia's West Kalimantan into an oil palm plantation.

The joint venture company, PT Mitra Austral Sejahtera, will have an initial paid-up capital of 1.4 million ringgit.

Austral will hold 65 percent in the venture and PT Pontimakmur the rest, a statement from Austral said.

It said the capital will be raised progressively during the development period of eight years.

Meanwhile, Golden Hope Plantations Bhd said it had also signed a joint venture agreement to develop palm oil plantations in Kalimantan.

It will initially develop 34,000 hectares with an investment outlay of 266 million ringgit in a 75:25 venture with Indonesia's Benua Indah Group, Golden Hope said in a statement.

Two mills with total rated capacity of 180 tons per hour will be built to process the expected crops.

The whole area is expected to be fully planted within four years.

The companies expect to invest another 288 million ringgit in the second phase of the venture to develop a further 38,000 hectares under a 70:30 venture.

The joint venture will set up a bulking installation and a refinery at a cost of about 70 million ringgit as part of the plans.