KUALA LUMPUR (June 27): Cahya Mata Sarawak Bhd (CMS)’s unit Cahya Mata Phosphates Industries Sdn Bhd (Phosphates) has filed an appeal at the Court of Appeal to stop state utilities firm Syarikat Sesco Bhd (Secso) from cutting off the supply of electricity to its phosphate production plant.

In a bourse filing on Tuesday (June 27), CMS said this follows the dismissal by the Kuching High Court of Phosphates’ application for an interim injunction on June 16.

Case management has been fixed for Aug 8, and CMS said its top management will continue to assert its claims through arbitration proceedings, as well as to explore all other possible legal recourse to protect all of its rights.

“The arbitration proceedings surrounding the power purchase agreement (PPA) have commenced, and we firmly believe that the PPA is intact and in force, and not terminated as alleged by Sesco,” CMS said in an earlier filing on June 20.

Phosphates, formerly known as Malaysian Phosphate Additives (Sarawak) Sdn Bhd, and Sesco have been involved in a dispute since November last year, in relation to a PPA dated Jan 15, 2019.

Sesco had insisted on charging Phosphates a higher-tiered tariff, but CMS insisted that the PPA only allows the higher tariff upon commercialisation of the phosphate plant in Samalaju, Sarawak.

The appeal, CMS said, is not expected to have any material business, financial or operational impact on the group.

In another development, CMS said its wholly owned subsidiary Cahya Mata Cement Sdn Bhd had approved to proceed with the proposed construction of a new clinker line, with a daily production of 6,000 MT per day or 1.9 million MT per year, in Mambong, Kuching.

The plant is estimated to cost RM750 million, and take 36 months to complete, the group said in another filing with Bursa Malaysia on Tuesday.

CMS shares closed unchanged at 96 sen each on Tuesday, giving the group a market value of RM1.03 billion. Year to date, the counter had fallen by 10.28%, from RM1.07 a share on Jan 3.

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