01/04/2015 (tce today) - Malaysian palm oil planter Genting Plantations is to spread downstream with plans to build a 300m ringgit (US$82m) refinery in Sabah.

The plant is set to have a capacity of 600,000 t/y and is scheduled to start operations in the second half of 2016. It will be built with the help of Indonesia’s Musim Mas Group, which will take a 28% interest in the company set up to run the refinery. Genting Plantations will hold the remaining 72%.

In a statement, Genting Plantations CEO Tan Sri Lim Kok Thay says that the palm oil refinery will be part of the larger Genting Integrated Biorefinery Complex that will produce “high value-added downstream products.”

Genting Plantations is operating around 244,000 km2 of plantations in Indonesia and Malaysia and with this latest move is becoming one of the sector’s vertically-integrated players, joining companies such as Sime Darby and IOI Corp. By refining their own palm oil the companies look to extract more of the value from their product and insulate themselves from changes in palm oil prices.