THE National Development Corporation (NDC) and Naval Bharat Pte Limited of Singapore (NBS) yesterday signed a 111 million US-dollar joint-venture agreement to establish an oil palm farm and processing plant in Kisarawe District, Coast Region.
The agreement was signed in Dar es Salaam by NDC Managing Director, Mr Gideon Nasari and NBS Managing Director, Mr Devineni Ashwin. The project will also cater for the production and processing of oil palm in Kimala Misale village in the district.
NDC has requested additional land in Dutumi village in Kibaha District for the same purpose. Under the agreement, NDC will have a 20 per cent stake in the joint venture while NBS will hold 80 per cent shares.
Signing of the contract is a result of a memorandum of understanding (MoU) between the two firms signed on July 18, 2011 in which the parties agreed to collaborate in the establishment of large-scale agro-industry projects in the country.
NBS conducted a feasibility study for the oil palm project in which viability of the project was confirmed, which was followed by a series of negotiations involving the parties and other stakeholders.
NDC Managing Director, Mr Nasari, said the project envisages the development of a nucleus 8,000 hectare oil palm farm, with an out-growers scheme under contract farming and the establishment of a palm Oil extraction and refinery plant. Furthermore, he said it will include the establishment of a 2,000 hectare centre to support out-growers.
"This project will eventually lead to the generation of 10MW of electricity from biomass. The joint-venture company will provide out-growers with training on oil palm cultivation, extension services, financial support and a reliable market for their products," said Mr Nasar.
He said the project is important to the economy as it will increase the production of high quality edible oil in the country, create employment and generate income for the government and the promoters.
He said the plantation would be fully developed in four years and production was expected to commence in the seventh year.