KUCHING: OM Materials (Sarawak) Sdn Bhd (OM Sarawak), which owns a ferroalloy smelting plant in Samalaju Industrial Park, Bintulu, has sharply increased the production of ferrosilicon (FeSi) and manganese alloy as the plant is fully ramped up.
Last year, the plant produced 220,515 tonnes of FeSi and 242,341 tonnes of manganese alloys as compared to 174,540 tonnes and 173,911 tonnes respectively in 2017 or an increase of about 26 percent and 39 percent respectively.
OM Sarawak made a contribution of A$792 million (RM2.28 billion) to group revenue of OM Holdings Ltd (OMH) in the financial year ended Dec 31, 2018 (FY2018) against A$491.5 million (RM1.42 billion) in FY2017.
OMH owns a 75 percent stake in joint-venture firm OM Sarawak. Cahya Mata Sarawak Bhd (CMS) owns the remaining 25 percent equity interest.
The turnaround of OM Sarawak, according to CMS, was the main contributor to the astounding performance of the group in FY2018 when it posted revenue of RM1.71 billion and pre-tax profit of RM375.4 million, up by nine percent and 17 percent respectively as compared to RM1.58 billion and RM321.3 million in FY2017.
OM Sarawak, together with other associates – KKB Engineering Bhd, Sacofa Sdn Bhd and Kenanga Investment Bank Bhd – had their pre-tax profits collectively catapulted by 166 percent to RM108.1 million in FY2018 from RM40.6 million in FY2017.
CMS has attributed OM Sarawak’s good performance to its plant achieving full production, coupled with improved prices of its products.
“As at 31 December, 2018, OM Sarawak had a total of 16 furnaces in operation -10 furnaces producing FeSi and 6 furnaces producing manganese alloy.
“In comparison, there were 9 furnaces producing FeSi and 6 furnaces producing manganese as at 31 December 2017, with the 1st modified manganese alloy furnace commencing production in the middle of December 2016 and the other 5 manganese alloy furnaces were ramped up and commenced operations in stages by July 2017,” OMH said in a press release to announce its FY2018 financial results recently.
In the fourth quarter 2018 (4Q-2018), the plant produced a total of 57,792 tonnes of FeSi and 61,734 tonnes of manganese alloy.
“FeSi production volumes for the current quarter were comparable to the production volumes for the quarter ended 30 September 2018.
“Production of manganese alloy increased by approximately 11% for the quarter ended 31 December 2018 as compared to the quarter ended 30 September 2018 (55,628 tonnes),” added OMH.
In the 4Q-2018, the furnaces continued to outperform their respective design capacities.
According to OMH, the plant’s operations have consistently achieved stable performance and are deemed to be in a steady
state.
In 4Q-2018, OM Sarawak sold 60,222 tonnes of FeSi (61,179 tonnes in 4Q-2017) and 64,474 tonnes of manganese alloy (57,097 tonnes).
The plant has a capacity to produce about 200,000 to 210,000 tonnes of FeSi and 250,000 to 300,000 tonnes of manganese alloy per annum.
OM Sarawak is one of the pioneer investors in Samalaju Industrial Park.
There are currently two other companies that own similar smelting plants there. The two are Sakura Ferroalloys Sdn Bhd, a joint
venture of Asia Mineral Ltd,
Nippon Denko Ltd, Shinsho Corporation and Carbon Corporation Sdn Bhd, and Pertama Ferroalloys Sdn Bhd.
