7/1/06 KUALA LUMPUR, (Bernama) -- Sabutek Sdn Bhd, which specialises in palm oil waste derivatives, will invest RM8 million to expand its factory located in Teluk Intan, Perak early next year.

Its executive director, Ir Dr Mohd Shahir Liew, said that currently the plant could process 1,000 tonnes waste per month but with the expansion, its capacity would increase five times.

"Palm oil waste in Malaysia stands at 35 million tonnes per annum so something should be done to recycle the waste into useful products," Dr Mohd Shahir told Bernama in an interview recently.

From the waste, useful products produced by Sabutek include long fibres, pellets and pulverised fibres.

Dr Mohd Shahir said that China is Sabutek's major export market and that the factory's expansion would meet current demand, which was now exceeding supply.

"We are also looking for other potential markets, such as countries in West Asia," he said.

Dr Mohd Shahir said that Sabutek, established 12 years ago, had spent RM12 million for the first eight years for research & development (R&D).

"It was only in the last three years that we started to commercialise," he added.

Sabutek has six full time researchers and collaborates with local universities such as Universiti Teknologi Mara (UiTM), Universiti Kebangsaan Malaysia (UKM) and the International Islamic University Malaysia (IIUM).

In getting quality waste, Sabutek is looking at Ghana and Indonesia, the biggest oil palm producers in the African continent and Asian region, respectively.

"We are also talking to Felda (Federal Land Development Authority) and local oil palm mills for the resources," he said.

Asked on its financial performance, Dr Mohd Shahir said that the company reported 75 percent revenue growth this year and expected a "triple digit" growth next year.

However, he declined to reveal the numbers.

Sabutek also took the lead in the establishment of Asean fibre technology conglomerate, which has a factory in Karabi, Thailand, running at a capacity of 300 tonnes per month.

The establishment of Asean corporate entity in the form of conglomerates was the main recommendation by Asean Business Advisory Council (ABAC) to Asean leaders during the 11th Asean Summit held recently.

ABAC chairman, Datuk Syed Amin Aljeffri, had proposed that entrepreneurs from member countries cooperate in certain specific businesses or promote specific industry technology.

The Asian fibre technology conglomerate, which was established early this year, comprises Malaysia, Singapore and Thailand. Indonesia may join later as it is one of the major palm oil producers while Vietnam and Myanmar have shown interest.

The conglomerate had agreed to share technology knowledge, product applications and working environment. The signing of a detailed framework will be held next year.

The conglomerate would also work on inter country levy, concessions, tax incentives and funds.

-- BERNAMA