Eonmetall To Manage Palm Fibre Oil Extraction Plants For Felda

Eonmetall Group Bhd has inked a deal to manage palm fibre oil extraction plants at selected mill locations for Felda Holdings Bhd.

Eonmetall said its wholly owned subsidiary Eonmetall Carotene Oil Sdn Bhd (ECOSB) had entered into a build, operate, own and transfer (BOOT) arrangement with Felda’s subsidiary, Felda Palm Industries Sdn Bhd (FPISB).

Eonmetall said its wholly owned subsidiary Eonmetall Carotene Oil Sdn Bhd (ECOSB) had entered into a build, operate, own and transfer (BOOT) arrangement with Felda’s subsidiary, Felda Palm Industries Sdn Bhd (FPISB)

“The BOOT arrangement entails granting and authorising, on an exclusive basis, ECOSB to design, engineer, finance, construct, commission, own, operate, transfer, maintain and manage a palm fibre oil extraction plant on a BOOT basis at six selected mill locations as designated by FPISB.

“ECOSB and FPISB will enter into six separate agreements to formalise the BOOT arrangement for all the plants at the first-phase mills,” Eonmetall told Bursa Malaysia.

This, Eonmetall said, would be subject to the consent by Felda, at a fee to be paid by ECOSB in accordance with the terms and conditions as stipulated in a separate lease/sublease or licence/sublicence agreement.

“FPISB agreed, at its own cost, to supply the required amount of palm mesocarp fibre processed from fresh fruit bunches yearly on an “as is where is” basis to the plant for the purpose of an extraction process.

“And in consideration of the rights granted, ECOSB agreed to redeliver the de-oiled mesocarp fibre and share some percentage of the revenue or profit arising from the sale of red crude palm oil from the extraction process activity upon terms and conditions hereinafter appearing.”

Eonmetall also said the project may be implemented at an additional four mills belonging to FPISB upon the successful completion, commissioning, operation and commercialisation of all mills under the first phase mills.

“The project is expected to have a positive impact on the net assets, gearing and earning per share of Eonmetall for the financial year ending Dec 31, 2018,” it said.

In July, Eonmetall said it was investing more than RM100mil this year and in 2019 in its steel racking and machinery and equipment business, with about 70% of the budget going into the construction of 10 palm oil solvent extraction plants for a government-linked company in the plantation business.

Source: The Star Online