CORRECTED-Malaysia's Wah Seong plans palm oil project in Congo

Mon Jun 3, 2013 7:08am EDT

(Corrects company name to Wah Seong from Wah Soeng in headline, story)

BRAZZAVILLE May 31 (Reuters) - Malaysian diversified group Wah Seong Berhad plans to invest $744 million to develop a palm oil agro-industrial complex including a 180,000-hectare palm plantation in the Republic of Congo, the country's agriculture minister said.

The investment through the group's ATAMA Plantation subsidiary will, when completed, create the largest palm oil project in the Congo basin area and propel Kuala Lumpur-listed Wah Seong to the top of the global palm producers.

"About $744 million will be invested in the first ten years," Rigobert Maboundou said on Thursday during a ceremony at the future site of the project around 800 km (500 miles) north of the capital Brazzaville.

Construction of the palm oil transformation units will begin next year and production will kick off in 2017, Leong Kian Ming, ATAMA's chief executive officer, said during the ceremony.

"From 140,000 tonnes, production will rise to 720,000 tonnes per year at its peak," Kian Ming said.

Global demand for palm oil, which is growing by about 9 percent annually, has spurred investments in the sector, with several major Asian producers seeking new land for plantations in Africa.

Singaporean commodities trading giant Olam plans to develop 130,000 hectares for palm oil in Congo's neighbour Gabon, while Malaysia's Sime Darby has a 220,000-hectare concession in Liberia.

The palm developments have however raised concerns from environmental and conservation groups who say companies do not take into consideration the impact of projects on wildlife and the livelihoods of populations near the plantations.

Herakles, a company owned by New York venture capital firm Herakles Capital, has suspended work on its giant 60,000-hectare palm oil plantation in Cameroon after protests by environmental groups and villagers. (Reporting by Christian Tsoumou; writing by Bate Felix; editing by Joe Bavier and Keiron Henderson)

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