KUALA LUMPUR (Jan 26): Borneo Oil Bhd is acquiring seven plots of quarry land in Lahad Datu, Sabah as part of its expansion plan into limestone mining.

The company said the purchase will allow it to engage in marble block extraction for the export of limestone.

“With the acquisitions, the company together with its existing land bank of limestone reserves held for long-term investment shall become a substantial player in the supply of high-grade limestone resources,” it said.

In a filing with Bursa Malaysia, it added that the Borneo marble brand has over the years established a name for itself and is well known in China.

The total purchase price is RM100.58 million, of which RM20.58 million is for the sublease of six parcels of quarry lands measuring 32.57 hectares and the remaining RM80 million is for the sublease of another piece measuring 5.49 hectares.

The transaction is expected to be completed within two months and Borneo Oil estimates the seven properties to provide a net income of RM10.04 million per year.

Borneo Oil also said that once a clinker plant has been set up in the eastern part of Sabah, it will require around 800 tonnes of limestone a day and this will add to the future prospects of monetizing the limestone reserves either through the supply of limestone or other form of joint ventures.

Yesterday Borneo Oil also announced the acquisition of a 95% stake in mining company Jusra Mining Merapoh Sdn Bhd for RM5 million.

Borneo Oil shares closed unchanged at 16 sen today, giving a market capitalisation of RM484.61 million.