Sarawak Oil Palms, Pelita agree to scrap deal

PETALING JAYA: Sarawak Oil Palms Bhd (SOPB) and Pelita Holdings Sdn Bhd (PHSB) have mutually agreed to withdraw a joint venture (JV) agreement, which was signed by both parties on Oct 25, 2011.
The move is the third JV agreement the two parties have scrapped this year, citing insufficient land for oil palm development after months of negotiations.
In May this year SOPB and PHSB said they were cancelling two JV agreements, inked in November 2007, involving oil palm development in Sarawak.
"SOPB hereby surrenders all its rights, title, interest, benefits and privileges under the said agreement and release and discharge PHSB and NCR Owners from further performance of PHSB's and/or the native customary rights (NCR) owner's obligations under the said agreement and from all claims demands and liabilities whatsoever arising out of or in respect of the said agreement," the company said regarding yesterday's announcement.
It said PHSB on its own behalf and on behalf of NCR owners hereby release and discharge SOPB from further performance of SOPB's obligations under the said agreement and from all claims, demands and liabilities whatsoever arising out of or in respect of the said agreement, including payment of quit rent and assessment rate, if any.
SOPB said all legal fees and incidental expenses incurred in connection with the preparation of this mutual rescission of contract shall be borne by SOPB.
Under the joint venture agreement, PHSB was nominated by the Sarawak government to act as trustee for and on behalf of the land owners of NCR land situated at Sungai Arang, Bakong, Baram in Miri, Sarawak containing a gross area of about 1,645 hectares to be developed into an oil palm plantation for the benefit of the land owners.
Following the joint venture agreement, a new company, SOP Pelita Sg Arang Plantation Sdn Bhd was incorporated on Oct 25, 2011 with a paid-up capital of RM100.00, of which SOPB and PHSB held 60 and 40 ordinary shares each respectively.
It said the cancellation of the JV agreement is not expected to have any material effect on the earnings of SOPB Group for the financial year ending Dec 31, 2014.