FGV initiates new project to transform its estate and mill operations

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KUALA LUMPUR (July 3): FGV Holdings Bhd said it has initiated a project to strengthen, standardise and sustain best practices in plantation and manufacturing.

Aimed mainly at its oil palm estates and mills, the Model Plantation Concept (MPC) project started last year, with the pilot project carried out at FGV’s Tembangau 6 estate in Pahang and Besout oil palm mill in Perak, followed by Maokil 07 estate and Maokil oil palm mill in Johor.

“Its implementation sets new overall standards of SOPs for operation and agriculture practices, processing and manufacturing, increased compliance of the occupational safety, health and environment policies, optimising human resources, improvement of employee housing, and the use of technology and ICT,” the group said in a statement today.

FGV said the project has shown success, demonstrated by several certifications received by the two estates and two mills, including the Roundtable Sustainable Palm Oil (RSPO) certification, Malaysia Sustainable Palm Oil (MSPO) certification and the QE/5S Quality Environmental Practice (QE/5S) Malaysia Productivity Corporation.

FGV Group CEO Datuk Haris Fadzilah Hassan said one of the group’s operation challenges is the diversity of its 197 estates and 68 mills in terms of size, operating cost, facilities and manpower capabilities.

“Through the implementation of the MPC project, optimum standardisation can be achieved, resulting in increased productivity and cost reduction.

“For example, the Maokil oil palm mill, which has been operating for 29 years, has successfully shown an increase in productivity, processing an oil extraction rate of 20.74% in 2019 compared with 19.68% in 2018.

“Looking at Maokil’s success, we are confident that the MPC project will be the catalyst for the transformation of the company’s business plan,” he said.

FGV said it will implement the MPC project in phases. The next phase will be at the Palong 8 rubber plant in Negeri Sembilan, Delima Oils Products refinery in Johor, and Embara Budi oil palm mill and Sahabat 11 estate in Sabah.

At 3.25pm, FGV’s share price was unchanged at RM1.02, giving a market capitalisation of RM3.72 billion.