KUALA LUMPUR: Elridge Energy Holdings Bhd plans to install and commission four new palm kernel shell biomass production lines in Kuantan, Pahang, under a RM13mil expansion to boost production capacity.
In a filing with Bursa Malaysia, the biomass products manufacturer said the new production lines, to be undertaken through its wholly owned subsidiary, Bio Eneco Sdn Bhd, are targeted for completion in the fourth quarter of its financial year ending Dec 31, 2026 (FY26).
The expansion is separate from the capacity enhancement plan outlined in the group's August 2024 prospectus.
Of the expansion plan disclosed in the prospectus, Elridge said expansions in Kuantan and Pasir Gudang, Johor, have been completed, while the expansion in Lahad Datu, Sabah remains in progress.
The new production lines will add an aggregate production capacity of approximately 480,000 metric tonnes (MT) per annum, comprising 120,000 MT per annum per line.
“Upon completion of the new production lines, the company’s total installed production capacity will increase from approximately 1.44 million MT to approximately 1.92 million MT per annum,” it said.
Elridge said the additional Kuantan capacity would allow it to accelerate expansion in Peninsular Malaysia, citing the location's proximity to feedstock sources and direct access to Kuantan Port, which provides a cost-effective export route to overseas customers.
"The company is strategically positioning itself to capture the higher volume of market demand," it said, adding that feedback from both existing and new customers indicates demand for its biomass products is expected to remain strong.
The company also said the increased output would provide feedstock for downstream products such as activated carbon, enabling it to serve a broader range of biomass customers.
“The installation and commissioning of the new production lines of approximately RM13mil will be funded through the group’s internally generated funds and/or bank borrowings,” it said.
Elridge expects the new production lines to contribute positively to revenue and earnings from the financial year ending 2027, although the earnings impact in FY26 is not expected to be material due to the targeted completion timeline and initial depreciation costs.
