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Kulim eyes palm estate in PNG, Solomon Island – report

Posted on: May 30, 2009


Reuters – Wednesday, May 27

KUALA LUMPUR, May 26 – Malaysian planter Kulim Bhd plans to boost its oil palm plantations by 12 percent to 93,100 hectares by developing new estates in Papua New Guinea and the Solomon Islands, state news agency Bernama reported on Tuesday.

Unlike other Malaysian planters that prefer to develop and buy estates in neighbouring Indonesia as land at home starts to run out, Kulim has tended to focus on these two South Pacific nations despite Papua New Guinea’s significant crime problems.

In 2007, Kulim sold its entire Indonesian plantation business for $125 million to focus on Papua New Guinea and the Solomon Islands as revenues in Indonesia lagged its other investments and the business was a “challenge to manage”. “The group has identified a new plantation area of about 6,000 hectares in PNG, where planting is scheduled to take off by the end of this year,” Bernama quoted Kulim Chairman Muhammad Ali Hashim as saying.

“In the Solomon Islands, it has identified 4,100 hectares of land next to an existing plantation and planting here is expected to start on 1,000 hectares first,” he told reporters.

Kulim will undertake expansions via its London-listed subsidary, New Britain Oil Palm Ltd <NBPO.L>, which is the biggest plantation firm in Papua New Guinea.

Muhammad Ali did not give a figure for the investments in the two countries but said the company planned to open palm oil refineries in Papua New Guinea in 2010 and 2012.

Kulim owns now 83,000 hectares of plantation land in Malaysia as well as Papua New Guinea and the Solomon Islands, which contribute more than half the firm’s revenues, company statements show. (Reporting by Niluksi Koswanage; Editing by Clarence Fernandez)

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