06/05/2016 (Bernama) - Felcra Bhd, Koperasi Sukau Kinabatangan Bhd (Kosuk) and Winsome Harvest Palm Oil Mill Sdn Bhd will build a palm oil mill costing RM60 million in Sukau, Kinabatangan this year.

The three parties today signed a memorandum of understanding (MoU) to facilitate the project.

Felcra was represented by a Member of its Board of Directors, Datuk Dr Baharum Mohamed; Kosuk was represented by its Chairaman, Azhari Rangon; while Winsome Harvest General Manager Tan Kem Yang signed on behalf of the company.

The signing ceremony held here was witnessed by Felcra Chairman Datuk Bung Moktar Radin who is also Member of Parliament for Kinabatangan.

At a press conference later, Bung Moktar said through the MoU, Felcra and Kosuk would hold a 20 per cent stake each in the project while Winsome Harvest will own a 60 per cent equity interest.

He said the palm oil mill would be constructed on 40.4-hectare land owned by Kosuk and it would have a capacity to produce 60 tonnes per day.

Construction of the mill would start this year and scheduled for completion in three years, he added.

"The mill will give an economic impact not only to the residents in Sukau but also those in Kampung Bilit, Sentosa Jaya, Bukit Garam and Batu Putih.

"This area is full of smallholders, hence they can market their oil palm fruits directly to the factory at more reasonable prices," he said.

Bung Moktar said for Felcra, its involvement in the palm oil mill project was part of its transformation efforts and social responsibility to help the community to generate economy.

Prior to this, he said Felcra had spent RM25 million to build 100 houses in Sukau through Kosuk for the cooperative's members.

He said Kosuk had to pay back Felcra RM12.3 million for the cost of building the houses.

"Through its 20 per cent equity interest in the palm oil mill, Kosuk is expected to receive RM750,000 per year and it can use this income to pay back the cost of building the houses to Felcra," he added.