FEASIBILITY REPORT FOR ESTABLISHING A SMALL SCALE OIL PALM MILL IN ITU LOCAL GOVERNMENT AREA, AKWA IBOM STATE, NIGERIA

Uwem Essia uwemessia@yahoo.co.uk

10/1/2013

This feasibility report makes a case for the establishment of small scale oil palm processing oil (the Mill) in Akwa Ibom State along Calabar-Itu road.

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Executive Summary

This feasibility report makes a case for the establishment of small scale oil palm processing oil (the Mill) in Akwa Ibom State along Calabar-Itu road, and in-between Mbak Atai and the Head Bridge. The Mill will use palm fruits and palm kernel nuts to produce crude palm oil (CPO), palm kernel oil (PKO), and palm kernel cake (PKC). The case for feasibility of the Mill is founded on the following findings:

1. Excellent Demand Prospects for CPO, PKO, and PKC; there is supply shortage for these products, and domestic demand is currently augmented by imports.

2. Availability of inputs; oil palm produce are generally available, the technology for fabricating oil palm processing mills are available locally, labour is generally cheap, and locating the Mill in the area identified will ease access to raw materials.

3. Oil palm milling open opportunities to establishing plantations, and producing further refined produce in the near future.

4. Profitability analyses indicate a payback period of three years. Given a venture capital of N65,070,000 to be committed to establishing the Mill in the first year, the net cash flow from the third to the seventh year of operation are N3,459,000, N22,857,000, N46,755,000, N70,653,000, and N94,551,000 respectively.

5. Environmental impact assessment indicated very minimal negative impact of the factories operation as all solid wastes generated from oil palm milling are recyclable. The positive impact of the Mill on the immediate operational environment and the economy include high quality finished products, job creation, poverty alleviation, and development of the oil palm processing technology.

The following key operational requirements were indentified for success and sustainability of the Mill:

• Satisfying the registration/certification requirements of NAFDAC and SON, and obtaining relevant permits and approvals of various Federal and State (MDAs) and the Local Government Council.

• Achieving value-for-money in procurement of oil palm fruits and palm kernel nuts, and effective liaison with PHCN to optimize the utilization of public power supply for milling.

• Ability to adjust hours of production to march availability of public power supply will be enhanced if the workers are quartered within or close to the Mill. Equally a working meal for the staff will promote their effectiveness and render them more responsive to flexible working hours.

• An effective and proactive maintenance/fabrication unit is necessary for reducing downtimes, continuing process innovation, and extending the machinery capacity to meet growing demand. A service contract with the machine suppliers during the first year of operation is recommended to enhance capacity building for staff of the unit.

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TABLE OF CONTENT Executive Summary 1. OPPORTUNITY 1.1. Demand for palm oil and palm kernel oil 1.2. Abundance of palm trees 1.3. Availability of cheap labor 1.4. Indigenized machinery technology 1.5. Vast expansion potentials 2 TECHNICAL DETAILS 2.1. Procurement of palm fruits and palm kernel 2.2. The Palm oil Mill 2.3. Palm Kernel Oil Extraction 2.4. Marketing of Finished Products 2.5 Organization 2.6. Statutory Requirements 3. OPERATING REQUIREMENTS 3.1. Transportation Facilitation 3.2. Locational Advantage 3.3. Land Requirement 3.4. Staff Welfare 3.5. Maintenance/Fabrication workshop 4. ENVIRONMENTAL IMPACT ASSESSMENT 5. FINANCIAL ANALYSIS 5.1. Analysis of Operating Cost and Expected Revenue 5.2. Determining the Venture Capital 5.3. Annual Financial Projections (2014 – 2020) 6. CONCLUSION APPENDICES Appendix I: Flow Chart for the Palm Oil Mill Appendix II: Detailed Cost Estimate for the Palm Oil Mill Appendix III: Flow Chart for the Palm Kernel Oil Mill Appendix IV: Detailed Cost Estimate for the Palm Kernel Oil

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1. OPPORTUNITY The economic opportunity that makes establishment of a small scale oil palm mill for production of crude palm oil (CPO), palm kernel oil (PKO), and palm kernel cake (PKC) arises from four main considerations, as follows:

I. Growing demand for CPO, PKO, and PKC. II. Abundance of palm trees III. Availability of cheap labor. IV. Local fabrication of oil palm processing machinery. V. Vast expansion potentials.

1.1. Demand for palm oil and palm kernel oil Currently Nigeria imports CPO and PKO as local supply are inadequate for domestic consumption and manufacturing needs, and as the manufacturing sector continues to grow the likelihood that demand for processed palm produce continue to outstrip supply, in the long term horizon, remains very strong. 1.2. Abundance of palm trees Nigeria is currently rated as the third largest cultivator of oil palm tree. With growing focus on economic diversification, the likelihood is that more improved oil palm estates would be developed. Growing cultivation of improved oil palm species guarantees adequate palm fruits and kernel for the proposed Mill. 1.3. Availability of cheap labor Small scale oil palm milling is largely labour intensive, and given the high level of youth unemployment (currently 37 percent for Nigeria), it is possible and easy to recruit a stable youthful workforce that would not be difficult to motivate and retain. 1.4. Indigenized machinery technology All components of the CPO and PKO mills are fabricated locally and there are readily available parts and spares. The Mill would readily build capacity for fabricating and innovating its machineries in less than 12 months of operation. 1.5. Vast expansion potentials Oil palm milling opens opportunities for manufacture of further refined products, and backward progression to establishment of oil palm plantation. Moreover, the technology for producing PKO is same as for processing groundnut oil, coconut oil, and so on, which makes diversification very easy.

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2 TECHNICAL DETAILS This technical detail for oil palm processing is discussed here under seven sub-headings, namely; procurement of oil palm fruits and kernel, crude palm oil mill, palm kernel oil mill, operating requirement, marketing of finished products, organization, and statutory requirements. 2.1. Procurement of palm fruits and palm kernel Procurement of oil palm fruits and palm kernel nuts should be effected directly from open markets by designated officers, through accredited suppliers/contractors who are issued LPOs, and from any other person who may wish to bring the produce to factory for sale. The Mill’s quality assurance unit must put in place simplified tests mechanisms to grading and pricing procured produce to ensure standardization and value-for-money. Both fruit bunches (FBs) and free from bunches (FFBs) should be procured. The FBs are threshed manually using contract/causal workers to obtain FFBs. The procured kernel are dried appropriately and prepared for cracking. 2.2. The Palm oil Mill The palm oil milling process is summarized in Table 1 and illustrated further in Appendix 1. The first step is sterilization (boiling). The boiled fruits are conveyed to the digester. The digested material is then pressed to separate CPO from the fiber and kernel. The CPO is thereafter moved to the purifier (clarifier), while the fiber is separated from the kernel. The kernel obtained from oil milling is dried alongside the directly procured kernel. The dried kernel is cracked and the shell separated using a screen and fan extractor. The fiber is covered for re-pressing after some days to obtain technical palm oil (TPO) that is more suitable for production of soap. Table 1: Palm Oil Processing Unit Operations Unit operation Purpose 1. Fruit

fermentation To loosen fruit base from spikelets and to allow ripening processes to abate

2. Bunch chopping To facilitate manual removal of fruit 3. Fruit sorting To remove and sort fruit from spikelets 4. Fruit boiling To sterilize and stop enzymatic spoilage, coagulate protein and expose

microscopic oil cells 5 Fruit digestion To rupture oil-bearing cells to allow oil flow during extraction while separating fibre

from nuts 6 Mash pressing To release fluid palm oil using applied pressure on ruptured cellular contents 7 Oil purification To boil mixture of oil and water to remove water-soluble gums and resins in the

oil, dry decanted oil by further heating 8 Fibre-nut To separate de-oiled fibre from palm nuts.

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separation 9 Second Pressing To recover residual oil for use as soap stock 10 Nut drying To sun dry nuts for later cracking Table 2 presents the crude input-output matrix of the palm oil milling process, taking into consideration only the palm fruits (inputs) and the output (CPO and kernel nuts) only. A working day of 10 hours (hrs) is assumed. It is also assumed that a working year has 300 working days. The remaining 65 days of the year are left out to account for possible downtime due to machine malfunctioning, holidays, and so on. As indicated in Appendix 1, the palm oil mill proposed has capacity for milling 500 kg FFB/hr, and 5,000kg of FFB/day. But an average milling rate of 2,500kg of FFB/day (50 percent of installed capacity) is assumed, which sum up to 750,000kg of FFB for a working year. The average milling rate of 2,500kg/day should yield approximately 500 liters of crude palm oil and 280 kg of cracked kernel per day. The 750,000 kg of FFBs/year, costing N9 million, should yield a minimum of 150,000 liters of CPO (valued at N24 million), and 84,000 kg of cracked kernel (valued at N5.21million). Basically, palm fruits worth N9million will yield N29.21 million (that is N24million worth of palm oil and N5.21million worth of cracked palm kernel. An extraction success rate of 85 percent is assumed to account for the fact that procured fruits will include a substantial proportion of low yielding local palm fruit species. Table 2: Basic Input-Output Matrix of the Palm Oil Mill

FFB, Capacity, Unit Price, Value

CPO, Output, Price, Value Cracked Kernel

Average Milling Capacity

Price @ Kg (N)

Value (Nm)

CPO in Liters

Price @ Litre (N)

Value (Nm)

Output (in Kg)

Price @kg (N)

Value (Nm)

Working Day 2,500 kg 12 0.03 500 160 0.08 280 kg 62 0.017 Working Year (300 days)

750,000kg 9.0 150,000 24.0 84,000 5.21

2.3. Palm Kernel Oil Extraction The kernel oil extraction process has four main steps as summarized in Table 3 and illustrated further in Appendix 2. The first step is to remove all foreign materials from the kernel both manually and using vibrator screens. The second step is to pass the kernel on a conveyor mat through an electric toaster. The toasted kernel is then mashed in an extractor to release crude kernel oil. Further extraction is achieved when the cake is pressed. The kernel oil is then purified/clarified and stored, while the cake is bagged. It is important to note that extraction success rate for PKO is almost 100 percent as palm kernel does not contain water. However, the electrical energy required for PKO extraction is much higher

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because of the high temperature required for toasting. The palm oil mill can be run with a 50KVA electrical generator, while the kernel oil mill requires a 250KVA generator. Table 3: Kernel Oil Processing Unit Operation Process Description Kernel pre-treatment The feed kernel is cleaned of foreign materials, both manually and using

vibrating screens. Toasting Kernel toasted at 104-110°C.to break the oil laden cells Oil Extraction Kernel is mashed to extract oil Screw-pressing Expelled oil is drained and the de-oiled cake discharged Oil clarification Solid impurities and fines removed and cake bagged The crude input-output matrix of the kernel oil processing unit is summarized in Table 4. The kernel oil mill has an installed capacity of 500kg kernel/hr, which amounts to 5,000kg per 10 hours working day. As was down for palm oil milling, an average milling rate of 2,500kg/day (and 750,000kg/year) is assumed. Kernel is currently valued at N62 per kg, which amount to about N160,000 worth of kernel milled per working day, and N41.29million worth of kernel milled per year. The daily output rates for PKO and PKC are 1,000 liters and 1,500kg respectively. This is based on the assumed ratio of 40 percent PKO and 60 percent PKC. PKC is currently sold for N225 per liter and PKC N25 per kg. The value of daily outputs of PKO and PKC are about N230,000 and N38,000 respectively. The yearly value of outputs of PKO and PKC are N67.5million and N11.25million respectively. Thus, palm kernel procured for N41.29million in a year yields N78.75million worth of PKO and PKC. Table 4: Basic Input-Output Matrix of the Palm Oil Mill

Kernel, Capacity, Unit Price, Value

PKO, Output, Price, Value PKC

Average Milling Capacity (Kg)

Price @ Kg (N)

Value (Nm)

PKO in Liters

Price @ Litre (N)

Value (Nm)

Output (in Kg)

Price @kg (N)

Value (Nm)

Working Day 2,500 kg 62 0.016 1,000 225 0.23 1,500 kg 25 0.038 Working Year (300 days)

750,000 = 84,000 (from CPO milling) + 666,000 procured

41.29 300,000 67.50 450,000 11.25

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2.4. Marketing of Finished Products There is ready market for CPO, PKO, and PKC. Beginning from the construction phase, Management of the Mill should commence scouting for supply orders from potential buyers within Nigeria. The Mill should open a robust website where information on its activities and contacts are publicized and linked to globally known supply/procurement websites. The expectation is that with competitive prices, the Mill will have no problem selling its finished produce. 2.5 Organization The organizational proposed for the Mill is as shown in Figure 1. The Mill should be registered as a limited liability company having a Board of Directors headed by a Chairperson. The General Manager (GM) oversees the day-to-day operation, and chairs the Management Committee, composed of the two foremen, head quality control, head general admin., and procurement officer/accountant. The list of other employees, as proposed, are in Table 5; palm oil processing should have 4, kernel oil processing 2, quality control 1, maintenance/fabrication 5, and general administration 8. The minimum qualification for all employees is SSSCE or it equivalent. The company would as well hire the services of daily paid/causal workers for threshing and selection of FBs and kernels, and loading/offloading as it becomes necessary from time to time. The workforce can also be enriched with the services of National Youth Service Corp (NYSC) members with relevant training and student’s on industrial attachment and internship.

Figure 1: Organization Chart of Proposed Oil Palm Mill

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Table 5: Other Employees of the Mill Unit Number Qualifications Palm oil 4 SSCE/OND certificate holders Kernel oil 2 SSCE/OND certificate holders Technical/Maintenance 5 SSCE/OND certificate holders (2 specializing on electrical and 3

on mechanical/fabrication) Quality Control 1 SSCE/OND certificate holders General Admin 8 4 Security personnel, 1 procurement officer/Accountant

(supervisor), 1 marketing officer/Secretary, and 2 drivers Total 20 2.6. Statutory Requirements The Mill will need to satisfy the registration/certification requirements of the National Agency for Food and Drug Administration and Control (NAFDAC) and the Standard Organization of Nigeria (SON). There are equally permits and approvals to be obtained from other State and Federal Ministries, Agencies and Departments (MDAs) and the Local Government Council. The usual practice is that the relevant agencies would issue demand notices to the Mill, and there will be opportunity to negotiate. Registering with the relevant oil palm millers’/marketers’ associations would enhance access to critical information that would make doing business much easier for the Mill. Beyond the official certification and registration requirements, effective and efficient functioning of the Mill calls for excellent non-formal relationships with key government officials, political leaders, and community leaders. Of critical importance is friendship with officials of relevant public electricity supply agency to ensure adequate electricity supply to the Mill and avail the Mill information on timing of electricity supply, to achieve higher proportion of output is produced when public power supply is available. 3. OPERATING REQUIREMENTS The major operating cost items for both mills are listed and explained briefly in this section, as follows: transportation facilitation; locational advantages; land requirement; supply of water and electricity; and establishment of the maintenance/fabrication workshop 3.1. Transportation Facilitation Transport of procured fruits and kernel from different markets and buying points would require a minimum of two DYNA pick-up trucks. It is also essential to have a utility car to serve administrative and public relations needs. 3.3. Locational Advantage Locating the Mill in Akwa Ibom State around the Itu Local Government Headquarters ease access to palm fruits and kernel nuts from the Okurikang and Itu markets axes where large

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quantities of palm fruits and kernel nuts are sold on bi-weekly bases. Equally, a viable oil palm mill located along Calabar-Itu road would make better business for regular vendors who move oil palm from destinations in Cross River State for sale in Akwa Ibom and the South East States. 3.4. Land Requirement To allow for future expansion and prevent the need for relocation in the future (which can be very costly), a minimum of 3,000 sq meters is required for the factory. This is to ensure accommodation of a factory building (300-500 sq meters) with rooms for storage, and offices for the foremen. There should also be a concreted shaded threshing floor and non-shaded drying floor. The land should equally accommodate the administrative block, canteen, staff quarters, a gate house, and a loading/buying bay that are located close to the gate. A small area should be used as garden for cultivating crops like plantain, banana, and pawpaw where the boiler ashes and sludge are disposed as manure. 3.5. Staff Welfare It is of strategic security and production facilitation importance to have staff quarters for accommodating as many of the operating staff and supervisors as possible. Equally giving the employees a working lunch work will improve working efficiency and boost job satisfaction. First aid boxes would be provided, and sick employees would be allowed to take a few days off for treatment. 3.6. Maintenance/Fabrication workshop An equipped maintenance/fabrication workshop will reduce downtime due to machinery malfunctioning and promote process innovation and re-engineering. To ease capacity building, it is recommended that the Mill maintains a service contract with the machine fabricator/supplier for at least one year. 4. ENVIRONMENTAL IMPACT An average annual Milling rate of 2,500 kg (FFB)/day or approximately 750,000 kg (FFB) processed per year generates 262,500 kg of empty fruit bunches, 168,750 kg of oil-pressed fibers, and 131,250kg of palm kernel nuts (65,625 kg/year shell). Also, 750,000kg of kernel nuts should yield approximately 375,000kg of shell. These materials have economic uses and should more appropriately be referred to as by-products rather than waste products. All three are useable as fuel, The palm kernel shell can be used to fill potholes around the factory premises. Boiler ash is recyclable as fertilizer and factory floor cleaning agent. Wood consumption from the environment would be relatively small due to the recycled by-products. Accordingly, impact on the local tree population would be minimal. The Mill will however provide ready market for palm fruits and kernel from the local environment, while as well providing jobs.

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5. FINANCIAL ANALYSIS Two aspects of financial analysis is considered; first, is analysis of the monthly operating cost and expected revenue, and second the annual profitability projections for seven years (2014 – 2020). 5.1. Analysis of Operating Cost and Expected Revenue As indicated in Table 6, it is estimated that the Mill will require a total monthly operating cost outlay of six million, five hundred and seventy one thousand naira (N6,571,000) only. This is composed of four million, and one hundred and ninety one thousand naira (N4,191,000) only for palm fruits and palm kernel nuts (63.78 percent) procurement respectively, one million naira (N1,000,000) for wages and salaries (15.22 percent), and one million, three hundred and eighty thousand naira (N1,380,000) only for other operating costs (20.98 percent). The expected total monthly revenue from sales is eight million, five hundred and sixty two thousand, five hundred naira (N8,562,500) only. This is composed of five million, six hundred and twenty five thousand naira (N5,625,000) only for PKO (65.70 percent), two million naira (N2,000,000) only for CPO, and nine hundred and thirty seven thousand, five hundred naira (N937,500) only from PKC. A monthly net receipts of one million, nine hundred and ninety one thousand, five hundred naira (N1,991,500) only is expected to be transferred to the capital account each month. Table 6: Estimated Monthly Operating Cost and Expected Revenue Monthly Operating Cost Monthly Revenue Expectation Procurement of palm fruits 62,500kg @N12.00

N750,000 Value of CPO produced per month 12,500 liters @ N160

2,000,000

Procurement of kernel nuts 55,500kg @62

N3,441,000 Value of PKO produced per month 25,000 liters @ N225

5,625,000

Cost of Raw Materials 4,191,000 Value of PKC produced per month 37,500kg @ N25

937,500

General Manager N100,000 5 Supervisors/Foremen @ N50,000

N250,000

20 workmen operatives @ N25,000.

N500,000

Causal Labour N150,000 Wages & Salaries 1,000,000 Fuelling & Lubricants @ N20,000 for 25 working days

N500,000

Machine Maintenance @ N10,000 for 25 days

N250,000

Fuelling & maintenance of motor N300,000

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vehicles @ N10,000 for 30 days Lunch allowance for 26 workers @ N200 for 25 days

N130,000

Miscellaneous expenses N200,000 Other operating costs 1,380,000 Total Monthly Operating Cost Outlay

6,571,000

Balance transferred to fixed capital cost

1,991,500

Balance 8.562,500 Balance 8,562,500 5.2. Determining the Venture Capital A monthly net receipt of N1,991,500 accumulated over four months gives N7,966,000 which exceed the estimated monthly cost outlay of N6,571,000. This implies that once the fixed assets are put in place and the Mill starts full operation, the entrepreneur may only need to provide the operating cost for the first three months of operation, as thereafter the Mill will have fully earned what it requires as operating cost. In effect, what the entrepreneur needs to put forward for business is the fixed capital cost, the operating cost for the first month of commencing full operation, and the operating costs for three more months less the net receipts from preceding months. No operating cost is required after the fourth month of full operation.

Table 7 indicates that given a fixed capital cost of fifty million, seven hundred and thirty five thousand naira (N50,735,000) only, the monthly . As noted earlier, once the fixed capital items are provided, the entrepreneur needs to provide the monthly operating cost of six million, five hundred and seventy one thousand naira for the first month of operation only, and successively lesser amount for another three months. The monthly operating cost reduces progressively from N6,571,000 in Month 1 to N596,500 in Month 4. The adding the monthly operating cost for the four successive months to the fixed capital gives a total working capital of sixty five million, and seventy thousand naira (N65,070,000) only.

Table 7: Determination of the Venture Capital Fixed Capital Monthly Operating Expenses Venture Capital N50,735,000 Month 1 Month 2 Month 3 Month 4 N50,735,000 Operating Cost N6,571,000 - N1,991,500 - N1,991,500 -N1,991,500 6,571,000 Operating Cost N4,579,500 - N1,991,500 -N1,991,500 N4,579,500 Operating Cost N2,588,000 -N1,991,500 N2,588,000 Operating Cost N596,500 N596,500 TOTAL VENTURE CAPITAL N65,070,000

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5.3. Annual Financial Projections (2014 – 2020) The annual financial projections (2014 – 2020) are based on current cost and revenue estimates. The impact of inflation on net receipts is accounted for by the fact that changes in the procure cost for palm fruits and palm kernel nuts normally cause comparable increase in the market prices of the finished produce oftentimes leaving the margin between input prices and market prices of finished produce virtually unchanged. The cost of fixed assets for the commencing year (2014) is fifty million, seven hundred and thirty five thousand naira (N50,735,000) only. Aggregate operating expenses for 2014, seventy eight million, eight hundred and fifty two thousand naira (N78,852,000) only, is determined by multiplying the monthly operating cost (N6,571,000) by 12. The operating expenses is expected to reduce from the second year due to improved efficiency and process innovation. A total of five million naira (N5,000,000) only is provisioned for taxes, charges, registrations, and so on. One million and five hundred thousand naira (N1,500,000) only is provisioned for financing service contract for machine fabricators to build capacity for sustainability of maintenance and machinery re-engineering. The total cost outlay (cost of fixed capital + aggregate operating cost) is one hundred and thirty six million, eighty seven thousand naira (N136,087,000) only. Expected total revenue for the year is one hundred and two million, seven hundred and fifty thousand naira (N102,750,000) only, computed as value of monthly sales (N8,562,500) multiplied by 12. The net cash flow for 2014 is minus thirty three million, three hundred and thirty seven thousand naira (-N33,337,000) only. The second year equally has a negative balance of fourteen million nine hundred and thirty nine thousand naira (-N14,939,000) only. The Mill has positive net cash flow from the third year onwards. A payback period of three years makes investment in the Mill very attractive. Table 8: Annual Financial Projections for 2014 – 2020 (in ‘000 Naira) Items\Year 2014 2015 2016 2017 2018 2019 2020 Opening Balance 0 33,337 14,939 - 3,459 -22,857 -46,755 - 70,653 Land (for minimum of 3,000sq m)

10,000 - - - - - -

Palm oil Mill Machinery 3,630 - - - - - - Kernel Oil Mill Machinery 3,870 - - - - - - 50 KVA Generator for Palm oil Mill

1,535 - - - - - -

250 KVA Generator for Kernel Oil Mill

3.100 - - - - - -

Buildings (Factory, office block, canteen, staff quarters, etc.

20,000 4,000 4,000 4,000 - - -

Borehole & Overhead Tank

600 - - - - - -

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2 Dyna Pick-up Van 3,000 1 Utility Car 1,000 Maintenance/Fabrication Workshop

2,000 500 500

Misc. (office equipments, trucks, drums, etc)

2,000 1,000 1,000 500 500 - -

Cost of Fixed Assets 50,735 38,837 20,439 1,041 -22,357 -46,755 -70,653 Operating Expenses 78,852 76,852 76,852 76,852 76,852 76,852 76,852 Taxes, charges, registrations, etc

5,000 2,000 2,000 2,000 2,000 2,000 2,000

Service contract for machine fabricators

1.500 - - - - - -

Total Expenditure Outlay 136,087 117,689 99,291 79,893 55,995 32,097 8,199 Total Revenue 102,750 102,750 102,750 102,750 102,750 102,750 102,750 Net Cash flow (-/+) -33,337 -14,939 3,459 22,857 46,755 70,653 94,551

6. CONCLUSION The proposed small scale oil palm mill should produce crude palm oil (CPO), palm kernel oil (PKO), and palm kernel cake (PKC). It is assumed that the raw materials – palm fruits and palm kernel nuts – are available in adequate quantities to sustain the proposed mill. It is equally assumed that there are ready markets for the CPO, PKO, and PKC. But sustained success calls for sound management, commitment to meeting the relevant statutory requirements, and maintaining sound working relationships with the community members and relevant public agencies, especially PHCN. The financial prospect of the proposed Mill was generally impressive. The estimated venture capital for the Mill was estimated at N65,070,000, the Mill will expectedly have a payback period of three years, and it was projected that net cash flow at the end of the seventh year of operation would be N94,551. The environmental impact assessment indicated very minimal negative impact on the environment as all solid wastes produced in small scale oil palm milling are recyclable. It is therefore strongly recommended that the entrepreneur commit takes up the opportunities offered by small scale oil palm milling by establishing the Mill as prescribed.