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RM4b steel mill another step closer to reality
Published on: Friday, January 17, 2003
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Kota Kinabalu: A deal to set up a RM4 billion steel mill at Kampung Limau-Limauan, in Kudat, was clinched on Thursday with the handing over of a land title covering 1,200 acres to Nusantara Steel Group Sdn Bhd.Deputy Secretary Datuk Peter Athanasius, representing State Secretary Datuk KY Mustafa, handed over the land deed to Nusantara Chief Executive Officer Muhammad Hakim Lim Abdullah, witnessed by State Industrial Development Minister Datuk Wences Angang and the company’s Group Director, Tan Sri Osman Aroff, at Hyatt Regency Kinabalu here.

In his address, Wences assured that his Ministry would render every possible support to get the project off the ground, in line with the Government’s efforts to develop the local industrial sector.

He expressed optimism that the project would help accelerate industrial development that could make a positive impact on the State’s economic growth.

Wences, who is also Deputy Chief Minister, noted that the State’s industrial growth had been quite slow, contributing only 12 to 14 per cent to the Gross Domestic Product (GDP).

For this reason, the Ministry has taken several measures to further enhance industrial development in Sabah by providing sufficient basic infrastructure, reducing production costs and helping investors to settle problems relating to their project, he said.

“With this move, the Ministry hopes that contributions by the industrial sector to the State economy will increase to 25 per cent by 2010,” he added.

With the acquisition of the land title, Nusantara Steel had solved one of the three factors which will enable the company to commence physical works on the site.

The other factors being accorded attention by the State Government involve basic infrastructure and facilities, including roads and water supply to the project site, apart from reinforcing several highway bridges leading to the area to enable heavy machinery to be brought in.

Meanwhile, in his address delivered by Athanasius, Mustafa said the Government would continue to ensure that the project would materialise, having deemed it important.

In this respect, the State Government accepted an offer by the holding company to participate in the project by taking up equity involving 40,720,000 redeemable preference shares.

According to him, the support was evidenced by the construction of a dam across Sungai Milau in Kudat to increase water supply to the district, in addition to the project demand of 600 cubic metres of supply per hour.

Besides, the Government was also in the process of upgrading the RM40 million 21-kilometre road linking Parapat to Limau-Limauan, leading to the Nusantara Steel Project.

He said Petronas would make a meaningful contribution to the project with a pledge for ample gas supply of 30 to 50 million standard cubic feet per day.

In addition, Sabah Electricity Sdn Bhd was also in the process of constructing its power network with the capacity of 100MW from Kota Kinabalu, with an agreement to supply 40MW of “stable supply” as requested by the company, he added.

“This project is also in line with the Sabah Industrial Master Plan to promote downstream processing of the local natural resources, with natural gas being identified as one great potential for development.

“Nusantara’s steel project is further attuned to the State Government’s policy of dispersing industries to lesser-developed districts.

“I am confident that this project, with an investment of about RM4 billion and employment of 1,000 people, would contribute towards the setting up of supporting industries and services in Kudat and neighbouring districts,” he added.

Also at the ceremony was Assistant Industrial Development Minister Datuk Dr Patawari Patawe.



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