KOTA KINABALU: The State Government will maximise the use of technology and innovation to improve productivity, competitiveness and development of the palm oil sector.
Chief Minister Datuk Seri Panglima Haji Hajiji Haji Noor said growing progress in the palm oil sector and improvement of infrastructures as well as government incentives provided excellent business opportunities for industry players to venture into the downstream sector.
Sabah has nine palm oil refineries with a processing capacity of 7.48 million tonnes per year while two biodiesel factories are operating to produce 300,000 tonnes of biofuel per year, he said.
Speaking at the Sabah Transfer of Technology (TOT) Exhibition and Seminar at Sabah International Convention Centre (SICC) here today, Hajiji said the State Government has developed two strategic locations namely the Lahad Datu and Sandakan Palm Oil Industrial Cluster (POIC).
The POIC was set up as an integrated hub providing investment opportunities in the downstream sector and port to support the export and import activities of palm oil.
Construction of the Pan Borneo Highway connecting Sabah, Sarawak, Brunei and Kalimantan, Indonesia would also help enhance connectivity and transportation efficiency including for oil palm products, he said, adding that the Indonesian capital’s move to Eastern Kalimantan would create economic spillovers to Sabah.
For this reason, he said 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.
During the 12th Malaysian Plan (12MP), a total of 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 noted that 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.
Hajiji pointed out that the development of an oleochemical factory has huge potential as far as the downstream sector development is concerned since there is none in existence in Sabah and Sarawak.
Apart from virtually not having any competitors in Sabah, investors in the oleochemical sector could also be rest assured of a consistent supply of raw material in the form of palm oil, which is more environmental-friendly and at competitive cost compared to other raw materials, especially petrochemical.
He was also heartened to note two Sabah-based companies 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.
Hajiji said the State Government’s door is always open to domestic and foreign investors, as well as those interested in building a win-win partnership between the public and private sectors, particularly in the commercialisation of oil palm-related technology.