KOTA KINABALU: The Sabah government is adopting the latest technology and innovation to improve productivity, competitiveness and development of the palm oil sector.
Chief Minister Datuk Seri Hajiji Noor said the government was also providing incentives and better infrastructures to encourage industry players to venture into the downstream sector.
At the moment, he said Sabah had nine palm oil refineries with a processing capacity of 7.48 million tonnes per year while two biodiesel factories were operating to produce 300,000 tonnes of biofuel per year.
He said this in his speech, delivered by Deputy Chief Minister Datuk Dr Joachim Gunsalam, at the launch of Sabah Transfer of Technology (TOT) Exhibition and Seminar 2022 at Sabah International Convention Centre (SICC) here.
Hajiji said the state government had developed two strategic locations, namely the Lahad Datu and Sandakan Palm Oil Industrial Cluster (POIC), to be an integrated hub in providing investment opportunities in the downstream sector and port to support the export and import activities of palm oil.
Another move taken by the government, he said, was the construction of the Pan Borneo Highway connecting Sabah, Sarawak, Brunei and Kalimantan to enhance connectivity and transportation efficiency including for oil palm products.
He said Sabah would enjoy the economic spillovers when the Indonesian capital is relocated to Eastern Kalimantan.
This was evident when the state government allocated RM65.97 million to the Industrial Development Ministry, including the Department of Industrial Development and Research, to empower the state's industrial sector development.
Under the 12th Malaysian Plan (12MP), he said RM116.67 million was approved for the Industrial Development Ministry to cater to the development needs in the Kota Kinabalu Industrial Park, Lahad Datu POIC and the Sipitang Oil & Gas Industrial Park (SOGIP).
The chief minister said the collaboration between the ministry with the Malaysia Palm Oil Board (MPOB) in organising the TOT Sabah 2022 provided room for entrepreneurs and investors to venture into commercialisation in the palm oil downstream sector.
The technology offered by MPOB ranges from food product formulation to oleochemical and biomass products as well as green energy produced by refineries.
"I am confident that the involvement of local companies in the technology commercialisation of the palm oil industry will generate revenue and contribute to the development of the entire industry," he said.
On the development of an oleochemical factory, he said this sector has huge potential as far as the downstream sector development is concerned since there is none so far in Sabah and Sarawak.
Thus, he said there was no competitors for this sector in Sabah and assured investors of a consistent supply of palm oil's raw material, which was more environmental-friendly and at competitive cost compared with other raw materials, especially petrochemical.
He was also delighted to see two Sabah-based companies which have partnered with MPOB to produce value-added oil palm-based products.
The joint venture between MPOB and Sabah Softwoods Hybrid Fertiliser Sdn Bhd had resulted in the production of GanoEF bio fertiliser to control Ganoderma disease in oil palm.
The other was the joint venture between MPOB and the Sabah Sustainable Oil Palm Planters Cooperative Consortium to commercialise the technology of oil palm-based cleaning products, the first in Sabah.
"It opens up opportunity in the development of oleochemical through the production of basic elements for cleaning and personal care products as well as industrial for the local and export markets," he said.