16/8/06  (The Edge News)  -  QL Resources Bhd is venturing into Indonesia with a proposed partnership with local parties to develop an oil palm plantation on two parcels of land totalling 20,000ha in East Kalimantan.

Its subsidiary QL Oil Sdn Bhd on Aug 16 entered into a JV agreement with Hang Ting Pte Ltd (HT) and PT Pipit Citra Perkasa (PCK) to form a JV company, QL Mutiara (S) Pte Ltd.

The parties also entered into an agreement for the subscription of shares in PCK's subsidiary, PT Pipit Mutiara Indah (PMI), which will undertake the development of the land.

Under the JV with HT, QL Oil will have a 78.42% stake and HT the remaining 21.58% stake in QL Mutiara, which will subscribe for a 95% stake in PMI, with PCK holding the balance.

QL Oil will effectively hold 74.5% and PCK, including indirectly via HT, the remaining 25.5% of PMI.

QL said the total estimated cost of the project was about US$24 million.

It said QL Oil's portion, to be financed via internal funds and borrowings, would be US$22.35 million comprising US$17.88 million for its 74.5% portion and US$4.47 million in advances to PMI.

QL said the project would allow the group to venture into the Indonesian market and to significantly expand its oil palm plantation activities.