Kuching, 31 December 2013 – Cahya Mata Sarawak Berhad – (CMSB- 2852), Sarawak’s largest and integrated infrastructure development group, is pleased to announce that its wholly owned subsidiary Samalaju Industries Sdn Bhd (SISB) has entered into a Shareholders’ Agreement with Malaysian Phosphate Venture Sdn Bhd (MPVSB), Malaysian Phosphate Additives (Sarawak) Sdn Bhd (MPASSB) and Arif Enigma SdnBhd (AESB) for the development of a phosphate plant. The joint venture company under the Shareholders’ Agreement, MPASSB, will be owned as to 40% each by SISB and MPVSB and 20% by AESB.
This plant will be Malaysia and South East Asia’s first integrated phosphate complex (Complex) and will be located in Samalaju Industrial Park (SIP), Sarawak, Malaysia, an area within the Sarawak Corridor of Renewable Energy (SCORE). This is to take advantage of the competitively priced long term power supply prices and supporting infrastructure that have been successfully attracting other energy intensive industries to SCORE’s SIP.
Concurrent with the signing of the Shareholders’ Agreement, MPASSB has also firstly, finalised the Power Purchase Agreement Term Sheet (PPA Term Sheet) with Syarikat Sesco Bhd for the supply of the 150MW of power required. The parties are expected to sign the PPA Term Sheet in early January 2014 and this will be followed up with a Power Purchase Agreement between the parties, which is expected to be signed 1Q 2014. Secondly, MPASSB has entered in a Sale and Purchase Agreement with SISB for MPASSB to purchase from SISB approximately 350 acres of land in SIP to be used for the Complex.
CMSB’s Group Managing Director, Dato’ Richard Curtis, said:‘’CMSB’s investment in this project represented its second investment into SCORE located energy intensive industries and was of special significance in that this phosphate Complex embodied two firsts; this Complex is the first one of its kind in Malaysia and indeed South East Asia: secondly, it is the first non-metal or alloy based plant in SCORE’s SIP thus taking SCORE and CMSB into a dynamic new industrial sector that offers long term sustainable demand growth. Phosphorus is an essential base nutrient for animal and plant growth with no substitute and is widely used in food, feed and fertiliser products. Demand is growing due to population growth, changing dietary preferences and the increased use of fertilisers.”
MPVSB’s Executive Director, Mr Lim Lee Wan, said: “The success of our first phosphate additives plant in Lumut, Perak has proved the value and scaleability of our particular manufacturing processes. Our Sarawak phosphate Complex will enable Malaysia to both reduce imports of phosphate products and to expand the production of “Halal” animal feed and fertilisers. For Malaysia’s food and fertilizer industries this will enhance both supply security and price competitiveness as well as establishing a platform for future export orientated downstream industries.”
The Complex, with an approximate annual production capacity of 500,000mt of phosphate and related products, will be built on approximately 350acres of land strategically located near to Samalaju deep water port which is currently under construction. Construction of the Complex is expected to start in Q1 2014 and to be operational in phases starting Q1 2016 and to be fully commissioned by Q2 2018. It will employ nearly 1,000 skilled workers and staff and will involve an estimated capital expenditure ofRM1.04billion, which will be funded via a mixture of shareholders’ equity and long term bank funded debt, which is currently being arranged.