13/02/2012 (Jakarta Globe) - Eyeing growth in the crude palm oil sector, BW Plantation, a listed company, has secured a Rp 800 billion ($88.8 million) loan facility to expand its subsidiaries and buy more plantation land.

The loan, from state lender Bank Negara Indonesia, was signed last Wednesday and will mature in February 2020 with 10 percent annual interest, said BW Plantation’s corporate secretary, Kelik Irwantono.

“The company will continue its expansion in line with our view that the crude palm oil sector will remain bullish in the future,” he said.

Crude palm oil is BW Plantation’s key commodity. In the next two to three years, Kelik said, the company aims to own 150,000 hectares of plantation land, up from 94,000 hectares currently.

“For that, we could buy at least 25,000 hectares of land [this year],” he said.

BW Plantation is targeting a 25 percent increase in its crude palm oil production this year after expanding its production capacity in Senyiur village in East Kalimantan. The company’s production rose 21.4 percent last year, to 110,771 tons.

BW Plantation set aside Rp 700 billion in capital expenditure this year, most of which will fund a factory to process crude palm oil, plantation maintenance and land acquisition, Kelik said previously.

The company’s shares fell 4.11 percent to close at Rp 1,400 on Friday on the Indonesia Stock Exchange.

Other plantation companies are also looking to expand. Jaya Agra Wattie, for example, is seeking Rp 1 trillion this year as part of a plan to expand its plantations for crude palm oil and rubber.