KKB sees busy days ahead

KUCHING: KKB Engineering Bhd, which has secured contracts worth some RM370mil in the Sarawak Corridor of Renewable Energy (Score), is expecting more jobs as energy-intensive industries kick-start the construction of their manufacturing facilities in the Samalaju Industrial Park in Bintulu.

Group executive director Kho Pok Tong said KKB had been pre-qualified for Tokuyama Corp's proposed plant phase II expansion project, and OM Materials (Sarawak) Sdn Bhd and Hong Kong-based Asia Minerals Ltd's building and civil engineering packages for their proposed manganese plants.
Kho: ‘There will be a hive of activities in Samalaju from 2013 onwards.’

Japan's Tokuyama, which is investing RM3bil in a polycrystalline silicon plant, is now constructing its first factory under the project's phase I.

KKB's wholly-owned subsidiary, KKB Builders Sdn Bhd, was awarded a RM70mil contract last month by OM Materials to undertake the earthworks package of its US$450mil (RM1.30bil) manganese and ferrosilicon alloy smelter project. OM Materials is owned by Australian listed firm OM Holdings Ltd.

Asia Minerals has also started the earthworks for its proposed US$200mil manganese smelting plant.

“KKB is now embarking on a pre-qualifying proccess for Australia's Rio Tinto Alcan projects in both Malaysia and abroad,” Kho told StarBizWeek yesterday.

Rio Tinto Alcan, the world's third largest mining company, has earlier set up a joint-venture company, Sarawak Aluminium Co (Salco), to develop an aluminium smelter in the Samalaju Industrial Park.

Kho said KKB was also in preliminary talks with Japanese and American firms that were looking into investing in manufacturing facilities in Score.

Sarawak Chief Minister Tan Sri Abdul Taib Mahmud said recently that Score had attracted more than RM26bil in investments. Sarawak Energy Bhd, which generates and supplies electricity, is in talks with 25 potential Score investors.

Kho said KKB was keen to participate in the proposed new Samalaju deepsea port project. Now in a detailed planning stage, the port will primarily serve industries in Samalaju by handling the imports of their raw materials and exports of finished products.

“There will be a hive of activities in Samalaju from 2013 onwards. Several Malaysian companies are exploring investment in supporting and downstream industries there,” he added.

KKB's two other contracts in Score are the RM296mil Samalaju water supply scheme (including the supply of steel water pipes) and the RM5.5mil sub-contract for a structural steel package for the Tokuyama plant.

The scheme to bring raw and treated water from Bintulu town to Samalaju Industrial Park was completed last month two months ahead of schedule. Testing and commissioning of the water supply are now under way.

Kho said with a net cash reserve of RM91mil, KKB was financially strong to undertake major construction and civil engineering works for Score industries.

The group, he said, was seriously exploring the possibility of investing in new facilities in Samalaju Industrial Park to support its existing engineering services and to better serve its present and future clients.

Kho said to better position the group for more jobs and higher demand for fabricated steel structures (of which KKB has the niche) from Score and related steel products, KKB was in the midst of constructing a RM20mil new steel fabrication plant in Muara Tebas, Kuching.

Machinery at the new plant has been installed and is now under testing. The new facilities will double the group's installed capacity to 30,000 tonnes a year when it is operational in the second half of 2012.

Besides steel fabrication, KKB is also into manufacturing of steel pipes and LPG cylinders for both domestic and export markets as well as hot-dip galvanising.

Kho said the group had tendered for an estimated RM418mil worth of projects in Sabah, Sarawak and Brunei, of which 80% was by its engineering division and the rest by its manufacturing arm.

Its unbilled sales as of June 30 stood at RM170mil.

On KKB's Sabah operations, he said its manufacturing business would be boosted by the implementation of many infrastructural and public development projects in the state.