KUALA LUMPUR (July 5): OM Holdings Ltd, which debuted on the Main Market of Bursa Malaysia on June 22, said its smelting complex in Sarawak had been given the green light to resume operations. The plant was temporarily suspended from May 28 following a directive from the authorities.

In a statement, the group said that operations had recommenced initially, with four furnaces within a phased plan to ramp up production in stages, given the constrained manpower environment and its focus to prioritise employee safety.

As a result of the plant having to close down as part of the movement control order 3.0 (MCO 3.0) from May 28, the group declared force majeure on all its sales contracts and its power purchase agreement until the plant is able to resume and achieve steady-state operations.

“During the temporary suspension, the company was able to partially mitigate the impact on its supply chain by arranging for partial delivery of processed material to customers through third-party logistic service providers,” it explained.

It noted that multiple rounds of Covid-19 testing were conducted throughout June. As it stands, 37 employees continue to remain in quarantine.

It explained that following the active case management and testing done by the company, the Bintulu Division Disaster Management Committee allowed the plant to resume operations.

Operations of the four furnaces were recommenced last week, operated by employees who had tested negative for the virus.

“Given the ongoing restrictions, such as the extension of the MCO for Sarawak and taking into consideration the safety and well-being of all employees following a prolonged quarantine period, it is expected that the plant may not be able to return to prior production levels in the short term,” OM Holdings added.

As of yesterday, 83% of employees at the plant had received their first dose of the Covid-19 vaccine, and the vaccination drive is expected to be completed this month, subject to Sarawak’s vaccination schedule.

It has also been actively engaging with the relevant government authorities to manage the immigration approval process for foreign skilled manpower and contractors to enter Sarawak.

“These personnel are essential for the plant, among others, to restart the four idle furnaces, instal equipment for the furnace conversion project, to conduct final performance testing of the sinter plant and to carry out scheduled major maintenance. Strict Covid-19 protocols will continue to be implemented for all employees as required by the government authorities,” it stated.

As of 2.56pm today, shares in OM Holdings were trading 13.5% or 37 sen higher at RM3.11, valuing it at RM2.31 billion.