KUALA LUMPUR, May 8 (Bernama) -- Limahsoon Bhd, an integrated manufacturer of laminated boards, will invest an initial RM10 million in a plant to produce charcoal, activated carbon and biofuel.

According to the company, this is part of its effort to expand and diversity its business so as to maintain and subsequently increase its profitability.

The plant to be located in Perak will initially be capable of producing 6,000 metric tons of charcoal, 2,000 metric tons of activated carbon and more than 6,000 metric tons of biofuel annually, the company said in a statement Monday.

Its managing director Lim Chong Khim said the plant is part of group's Green Project, which is aimed at converting existing agricultural biomass to high value-added end products by applying environmentally friendly processes.

"The Green Project will capitalise on the group's experience and resources to enable the group to venture into the biomass business," he said.

Under the project, the charcoal will be produced via a continuous process rather than through a batch method.

Using the continuous process, the quality of the end product is assured due to consistency of carbonisation and production, the company said.

Based on this method, biofuel is also extracted, it said, adding that activated carbon, the final product of the entire process, will achieve a high quality assurance.

Another point of interest is the self-sufficiency of the project in not utilising external source of energy, according to the company.

Raw material for the daily production of charcoal, activated carbon and biofuel for plant will be sourced from local oil palm mills as well as from neighbouring countries like Thailand and Indonesia.

The largest market currently for activated carbon is the municipal water purification industry, where charcoal beds have been used for the dual purpose of physical filtration and absorption, Limahsoon said.

The company expects to market the activated charcoal as a green product, which means the product will have a premium on its selling price in most European countries as well as Japan because it is sustainable and renewable.

The biofuel that the plant produces will be able to be stored, pumped and transported like petroleum-based products and can be combusted directly in conventional diesel or MFO burner type boilers for heat and power applications.

Lim said the group has already received strong interest from potential clients for its Green Project products, both locally and abroad.

"Malaysia's move to spearhead the biomass industry in the region has further boosted the viability of our Green Project," he said.

The Perak plant is expected to be completed by August this year and production of the charcoal, activated carbon and biofuel will begin the following month.

-- BERNAMA