KUALA LUMPUR (Nov 17): Kuantan High Court today cleared Felda Global Ventures Holdings Bhd (FGV) of alleged fraud in the determination of its oil extraction rate (OER).

“The matter has been fixed for decision and after a full trial for 51 days, the Kuantan High Court decided to dismiss the entire settlers’ claims,” FGV said in a filing to Bursa Malaysia today.

In this case, 770 settlers demanded special damages, general damages and exemplary damages, as well as interest, alleging fraud, breach of trust, conspiracy, mischief and misrepresentation by Federal Land Development Authority (Felda) and Felda Palm Industries Sdn Bhd (FPISB) in the determination of the OER.

The settlers had earlier claimed the OER given to them were lower than the rate set by Malaysian Palm Oil Board (MPOB). All 571 settlers of Chini & Chini Timur have been ordered to pay the costs of RM300,000 to Felda.

To recap, Felda and FPISB were sued by Mohd Saleh Ishak and 769 settlers of Rancangan Felda Chini 1 to 5 and Rancangan Felda Chini Timur 1 to 3 in Pahang on May 10, 2012, for alleged fraud and manipulation of the OER.

FPISB is a major subsidiary of FGV which owns 72% stake in the company, whose core activities are purchasing and processing of fresh fruit bunch (FFB) from the Felda estates, settlers and external suppliers to produce crude palm oil (CPO) and palm kernel (PK).

Currently, FPISB is the largest CPO producer with a production of 2.51 million tonnes per year, which is 17% of Malaysia’s total production. It operates with 69 palm oil mills located throughout the country. The total milling capacity currently stands at 3,364 tonnes of FFB per hour or 17 million tonnes per year.