KLANG: Kuala Lumpur Kepong Bhd (KLK) has invested RM40 million in its fourth reactor specialty ester plant (EP4) and research and development (R&D) centre here.
KLK chief executive officer Tan Sri Lee Oi Hian said the new plant would provide an additional volume of 10,000 tonnes a year, making its overall production volume of 35,000 tonnes of oleochemical from its four plants in Klang.
"With this new plant, we will be able to increase our capacity and hence the efficiency.
"The increasing demand for specialty esters reaffirms the necessity of continuous investments and initiatives inline with the government's vision under the Palm Oil National Key Economic Area (NKEA) Entry Point Project 6 (EPP 6)," he said.
Lee was speaking with reporters after the opening ceremony of EP4 and R&D centre here yesterday.
He highlighted the palm oil industry is targeted to contribute RM178 billion to Malaysia's gross national income, creating 41,600 jobs by 2020.
"We believe that more research and commercialisation efforts on palm based downstream products are important to ensure the commodities sector remains sustainable and competitive in the long run," he added.
Lee said the centralised R&D centre is an important step in bringing cutting-edge technology and innovation in the development of oleo-based products and solutions.
Meanwhile, Second International Trade and Industry Minister Datuk Seri Ong Ka Chuan said KLK's expansion on the EP4 and the R&D centre create a positive spillover effect to its employees such as skills development and conducive workplace to support business sustainability.
"The oil palm is a productive crop providing food, energy and employment, thus improving socio-economic spillover in many developing countries.
"The palm oil industry is the fourth largest contributor to our economy and accounts for RM53 billion in the gross national income," he said.
Malaysia is the largest oleo-chemical producer and exporter in the world with a total production of 1.2 million tonnes in the first-half of 2017.
"The global oleochemicals market is forecast to grow at 6.3 per cent annually between 2017 and 2022, which is equivalent to US$26.8 billion," he said.
Ong said the government would continue to promote the growth of domestic investments towards developing Malaysia into a global centre for edible oils and oleochemicals.
KLK's EP4 produces ingredients that are used in cosmetics and bio-lubricants.
The R&D centre was set up as the company’s international research, development and technology hub to service and support its global oleochemical business.