KUCHING: BORNEO OIL BHD has been engaged as the main limestone aggregates supplier to an integrated limestone processing plant (ILPP) due for commissioning early this year in Lahad Datu, Sabah.
It is expected to deliver 600 tonnes per day of limestone from its quarry located adjacent to the processing plant.
Borneo Oil is also the project manager for the ongoing construction of the limestone processing plant.
There is rising demand for quarry aggregates, a key construction material, with the implementation of the Sabah Pan Borneo Highway project.
Borneo Oil is currently constructing a conveyor belt delivery system to transport the limestone aggregates from its quarry to the ILPP. The company plans to utilise RM4.81mil from a proposed private placement exercise to finance the construction of the conveyor belt delivery system.
“With completion of the semi-automated conveyor belt delivery system, the group envisages to achieve better cost and logistic efficiency as less manpower and trucks are required, ” said the company in its proposed private placement announcement on Dec 31,2019.
The corporate exercise is expected to raise a minimum of RM21.1mil and a maximum of RM30.56mil. The private placement, which entails an issuance of up to 10% of the company’s total issued shares, is expected to be completed in the current quarter.
From the proceeds, about RM11mil would be used to install power grid and an electrical substation for the group’s limestone quarry land.
As the group’s quarries are located in a remote area with no basic infrastructure, the current operation of crushing and grinding of limestone blocks into limestone aggregates utilises power generators, which according to Borneo Oil, is not viable in the long run.
“The electricity from the installation of the power grid and electrical substation is expected to reduce overall energy costs.
“The group has initiated laying the 26 km power grid together with the installation of an electrical substation. This is expected to be completed by early 2020. The power grid will be able to supply a total of 4 MW to the group’s quarries which will power, among others, the group’s conveyor belt delivery system and limestone quarry operations, ” said Borneo Oil.
The group is expected to spend RM2mil for the upgrading of the general infrastructure, like roads, for the limestone quarry operations.
The balance of the proceeds from the private placement will be for the group’s working capital.
Borneo Oil’s core business is in fast food and franchise operations under home-grown SugarBun restaurant chain.
According to executive director Raymond Teo Kiew Leong, Borneo Oil is expected to open another Borneo Asian Food restaurant along Jalan Tuanku Abdul Rahman, Kuala Lumpur in March.
The franchisee for the new restaurant is the operator of a hotel nearby. The first Borneo Asian Food restaurant commenced business in Menara Hap Seng, Kuala Lumpur in 2016.
The new food franchise brings some of the most popular dishes in Sarawak and Sabah to food lovers in Peninsular Malaysia.
“The signature dishes are Sarawak laksa and Sabah’s giant garupa mee hoon soup, ” said Teo. Other dishes on the menu include fish burger, SugarBun’s roasted chicken and fried rice.
There are Borneo Asian Food outlets in Kuching, Miri and Kota Kinabalu and in Johor. Bintulu is expected to have its first such restaurant in May.
Teo said SugarBun is expanding to Indonesia, with its first restaurant scheduled to commence business operation in the current quarter.The restaurant is housed in a two-storey building with seating capacity of about 150.
SugarBun’s Jakarta franchisee plans to set up two other restaurants in the Indonesian capital.
“We believe there is big business potential for SugarBun in Indonesia as its food, culture and language are similar to Malaysia. There is also its large population.
“Our next business target is Kalimantan with Indonesia shifting its capital to there, ” said Teo. However, there is yet to be any concrete plan to expand there.
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