JOHOR BARU, Feb 12 — Russia’s Orgkhim Biochemical Holding is investing about RM200 million to build a plant to produce petroleum-based extender oils for eco-friendly synthetic tyres in Tanjung Langsat near Pasir Gudang.

The project on a 2,023-hectare site is undertaken by its subsidiary, Norman Process Oils Malaysia Plant Sdn Bhd — its first investment outside Russia.

Orgkhim Biochemical Holding Chief Executive Officer Nikolay Khodov said the plant would be completed in 15 months’ time and would start operations in the middle of next year.

"Currently we are supplying China, South Korea and other Asian countries directly from Russia. Our volumes are growing. So, we will easily move production of these volumes to Malaysia,” he told reporters after the groundbreaking ceremony of the plant here today.

Present were Johor Tourism, Trade and Consumerism Committee Chairman Datuk Tee Siew Kiong and Malaysian Investment Development Authority Chief Executive Officer Datuk Azman Mahmud.

Khodov said in Russia, the company currently produces about 125,000 tonnes of petroleum-based extender oils for rubbers and rubber compounds per year and the new plant in Johor is targeted to produce 70,000 tonnes per year.

Meanwhile, Tee said the Johor government welcomed Orgkhim Biochemical Holding’s investment as it reflected the company’s support and confidence in the state’s economy.

He said Johor recorded the highest investment in the manufacturing sector among the states in the country for four consecutive years, with investments totalling RM93 billion and 65,000 jobs created.

"Even though MIDA data for 2017 has yet to be announced, the state government is confident that investment in the manufacturing sector for the 2013-2017 period will surpass RM100 billion.

"And we also believe that Johor will remain in the top third in Malaysia (in terms of investment) for 2017,” he said.

Azman said the new investment not only demonstrated investor confidence in Malaysia by capitalising on its growing chemical industry.

He said under the 11th Malaysia Plan, the chemical industry was identified as one of the sectors showing impressive growth besides electronics, machine and machinery, aerospace, and medical equipment.

"As at September 2017, 2,073 manufacturing projects in the chemical industry have been approved with investment worth RM96.5 billion.

"Of the total, 59.5 per cent (RM57.4 billion) was from foreign sources while the balance of 40.5 per cent (RM39.1 billion) was from local sources. These projects have created more than 97,000 jobs for the country.

"Orgkhim’s presence here also adds to the portfolio of companies from Russia that have invested in Malaysia. To date, 13 manufacturing projects with Russian participation valued at RM138.80 million have been approved, creating more than 600 jobs for the country,” he said. — Bernama