16/07/2008 (The Star Online), Kuala lumpur - Sime Darby Bhd aims to strengthen its position in the palm oil downstream business in South-East Asia by building a new RM330mil refinery in Port Klang's North Port.

President and group chief executive Datuk Seri Ahmad Zubir Murshid said the company had in May decided to construct the refinery, expected to be completed by mid-2010.

He said the decision was made due to the rise in global demand for refined oil palm products and Sime Darby’s large crude palm oil (CPO) supply base in Peninsular Malaysia after its merger exercise.

“North Port will give us scale and opportunity to use new technologies, which will further improve our productivity and efficiency. This expansion plan is only the beginning. We also have plans to expand our refining capacity in Indonesia, China, Europe and Africa to match our upstream expansion plans,” he said in a statement yesterday.

Sime Darby currently has refineries in Banting, Pasir Gudang and Bintulu with a total annual capacity of over 800,000 tonnes per annum. With North Port, its annual total refining capacity should increase to almost 1.5 million tonnes.

Zubir said the company planned to use all of its 600,000 tonnes of CPO production in the central region of Peninsular Malaysia for the new plant. The investment in North Port involves the construction of a 2,000-tonne-per-day refinery plant and includes a kernel crushing plant with storage tank facilities.

This will translate into about 660,000 tonnes worth of additional refining capacity for Sime Darby's plantation division in the central region of the peninsula.