KUALA LUMPUR, Oct 8 (Bernama) -- TSH Resources Bhd (TSH) will producepulp and paper from empty fruit bunches (EFB) and palm oil mill effluents(POME) by the end of 2006, its executive deputy chairman, Datuk AzizanAbdul Rahman, said Friday.

The company is in the final stage of pioneering the world's first pulp andpaper production from EFB at its fully bio-integrated complex in Kunak,Sabah, he said in his speech at a ceremony to officiate the unveiling amodel for Menara TSH, the new RM30 million corporate headquarters for TSHResources Bhd, by Second Finance Minister Tan Sri Nor Mohamed Yakcop.

Planned for commission next year, the complex could help substantiallysave the country in terms of foreign exchange as Malaysia imported RM4billion worth of paper products each year, said Azizan.

The complex, a joint collaborative effort with FRIM (Forest ResearchInstitute of Malaysia) and MPOB (Malaysian Palm Oil Board), would be alandmark development in the global oil palm industry, he said.

"It will also generate additional income to the oil palm industry andcreates new employment opportunities. This bio-integration business modelcan potentially assist our country in generating RM6 billion in revenue,if replicated," said Azizan.

TSH Resources is a fully integrated resource-based group with interests inoil palm plantations and milling, timber processing, cocoa manufacturingand sustainable forest management.

In trying to achieve maximum efficiency and profitability as well ashaving a "zero waste" strategy, TSH Resources runs its oil palm millsusing electricity from its own biomass power plant.

"We now have a biomass power plant that produces about 14 mw of greenelectricity for our own consumption and with spare capacity to sell to TNBto generate additional income," said Azizan.

The other "green" venture of TSH Resources is the planting of 5.5 milliontrees, representing one tree for every four Malaysians under a 100-yearsustainable forest management programme on 300,000 acres of forest land inSabah.

Speaking at a press conference later, TSH Resources group managingdirector Datuk Kelvin Tan said the evolvement into the pulp and paperplant as well as the biomass power plant was part of the group's motto of"don't waste wastes."

He said TSH Resources was working on establishing an eight megawattbiomass power plant in Ipoh by 2006 from woodwastes discarded by EkowoodInternational Bhd, its subsidiary which manufactures engineered solidhardwood flooring.

Tan said TSH Resources viewed the economic resource of oil palmdifferently from other companies as crude palm oil constituted only 20percent of the entire mass produced.

"We believe that there is also value from the balance of 80 percent likethe empty fruit bunches and fronds," he said.

Tan said the evolvement towards getting more value from EFBs was a naturalprogression for the company which entered into oil palm plantations onlyseven years ago after having started in cocoa production and vegetablefats processing.

On Ekowood, he said it had successfully carved a name for itself as ahomegrown global brand as its quality products were sold in more than 30countries and it had also taken up the incentives given by the governmentto promote Malaysian brands.

Ninety-three percent of its flooring is exported by Ekowood, which isexpected to be listed on Bursa Malaysia on Nov 8.

On expanding its palm oil interests abroad, Tan said it would set up a 60tonne per hour palm oil mill at Padang in West Sumatra with PT Astra, anIndonesian company.

Tan expressed the hope that business and investment conditions wouldimprove under Indonesia's new leadership and this would encourage TSHResources to obtain more lands banks for plantation purposes in thatcountry.

There were other areas which the company could venture into in Indonesiaand they included replicating the successful Malaysian ventures, he said.

-- BERNAMA