Uggah (left) and Emir at the launch of FGV inaugural sustainability report.

17/06/2014 (The Star) - Felda Global Ventures Holdings Bhd (FGV) is still interested in expanding its plantation empire via London-listed New Britain Palm Oil Ltd (NBPOL) although it is aware that it may face stiff competition.

In May, the world’s third-largest palm oil producer has said it was looking at NBPOL as part of its growth strategy.

Sime Darby Bhd, the Sultan of Johor and a Singapore-listed China entity were reported to be also keen to be a major shareholder of the lucrative Papua New Guinea (PNG)-based company.

Another interested party believed to be keen in having a stake in NBPOL is Singapore-based Wilmar International Ltd.

“I heard about the other interested parties. We are still reviewing the proposal and have not decided on our position yet but we will seek guidance from the PNG government on how to go about it.

“And you will know pretty soon,” FGV group president and chief executive officer Mohd Emir Mavani Abdullah told reporters after the launch of the company’s inaugural sustainability report by Plantation Industries and Commodities Minister Datuk Seri Douglas Uggah Embas here yesterday.

Emir added that FGV was looking at various proposals to expand its upstream and downstream businesses through a very rigorous process. “But, I think there will be an acquisition this year,” he said.

The competition for NBPOL could spark a bidding war between the interested parties as they are all the big boys of plantation sector.

NBPOL is 48.97% owned by Kulim (M) Bhd, which in turn is a subsidiary of Johor Corp (JCorp).

However, there has been talks that Kulim might look to dispose of its holding in NBPOL, if the price was right.

NBPOL is a large palm oil producer with 77,000ha of oil palm plantations in PNG and the Solomon Islands, 12 palm oil mills and one refinery each in PNG and Liverpool. The group is also the largest domestic sugar and beef producer in PNG via its over 7,700ha sugar cane plantations and 9,200ha of grazing pastures as well as a seed production and palm breeding facility.

The stock is considered the pride of PNG with West New Britain Province owning 12% of NBPOL.

On crude palm oil price (CPO), Emir agreed with the views of many analysts that in the long-run, it might be stabilising between RM2,600 and RM2,700 per tonne due to the impending El Nino effect that would pull production down.

“Nevertheless, we are strategising to maintain our yield. We are also closely monitoring the soy bean crop in the United States as the price between soy bean oil and CPO is at a low disparity now,” he said.

On its first sustainability report with the theme “FGV Enriching Values, A Continuous Journey”, Emir explained that as a responsible corporate citizen, sustainable practices were very important.

“These are the measures that allow us to provide better assistance in protecting the environment and the future community.

“These will be crucial parts to our growth initiatives as our success cannot be achieved without this sustainable efforts in place,” he said.

Through its sustainability practices, FGV has so far reduced greenhouse emissions by 136,728 tonnes of carbon dioxide and produced more than 800,000 tonnes of CPO according to the tenets of Roundtable Sustainable Palm Oil.

Meanwhile, Uggah said the Government that had approved the implementation of the Malaysian Sustainable Palm Oil (MPSO) certification scheme, hoped for support and participation from local plantation companies like FGV.

“I hope that all FGV plantations will be among to be certified under the MPSO,” he said.