Monday, March 28 2005 - FPG Oleochemicals Sdn Bhd, a 50-50 jointventure between Felda Palm Industries Sdn Bhd and Procter & Gamble (P&G)of the US, is set to turn its plant in the Kuantan Port Industrial Areainto the biggest oleochemical complex in the world.

Its latest major expansion project is the RM200 million fatty acid plantwhich will boost the company’s derivatives and production capabi-

lities once it starts its scheduled operation by the end of next year.

Under the project, Felda will contribute raw materials and bulkingfacililty, while FPG will provide the technical assistance for the productmanufacturing and marketing service.

Deputy Prime Minister Datuk Seri Najib Razak performed the fatty acidplant’s ground-breaking ceremony on Saturday.

He also opened FPG’s expanded glycerine refinery, which started operationsin December last year, at an investment cost of over RM60 million.

Also present at the event were Pahang Deputy Menteri Besar Datuk Tan MohdAminuddin Ishak, Felda chairman Tan Sri Dr Mohd Yusof Noor and FPGmanaging director Martin Herrington.

Herrington, who is also P&G Chemical Asia managing director, said thesuccessful collaboration with Felda through FPG had prompted the hugeinvestments and more are expected in the near future.

"The rapid expansion of the Asian oleochemicals market is the main reasonwhy P&G is re-enforcing its partnership with Felda through theseinvestments," he said.

He added that with the basic oleo-chemical building blocks of methylesters, fatty alcohols, fatty acids and refined glycerine in place oncethe new plant is fully operational, FPG plans to manufacture further oleo-

chemical derivatives that are needed in the Asian market.

“The Kuantan site provides a good logistics advantage. We have also awell-trained and motivated work-force.

“Our plans for the new plant, once they fully materialise, would turn itinto the biggest olechemical production complex in the world,” Herringtonsaid.

The groundwork for the plant expansion has already been initiated. FPG iscurrently in negotiations with the Pahang State Government to aquire moreland for future expansion of its production facilities.

The planned fatty acid plant is a diversification project to ensure thatFPG has on-site all the basic oleo-chemical building blocks.

The new plant has a production capacity of 120,000 tonnes of fatty acidper annum. The main feedstock for the plant are palm oil and palm kerneloil.