By Othel V. Campos

The government has identified 18,494 hectares of logged-over areas in Davao del Norte as potential site for the proposed $1-billion farm project of San Miguel Corp. and Malaysia?s Kuok Group.

Marriz Agbon, president of Philippine Agricultural Development and Commercial Corp., said the initial areas cover the municipalities of Kapalong with 3,246 hectares; San Isidro, 5,860 hectares; Talaingod, 7,860 hectares; and New Corella, 1,552 hectares.

San Miguel, the country?s largest food and beverage company, and Kuok earlier said they might spend over $1 billion to develop crop lands to benefit from soaring grain prices.

The two companies plan to develop one million hectares of government land in the Philippines in a 50-50 joint venture to produce sugar and grow coconut trees, and grains, including rice and corn.

San Miguel chairman Eduardo Cojuangco Jr. said during the signing of memorandum of understanding that the project entailed developing one million hectares of agricultural land at $1,000 per hectare.

San Miguel and Kuok?s initiative is part of President Gloria Macapagal Arroyo?s food security program, whose first phase covering the four Davao del Norte municipalities will shortly be launched.

President Arroyo has called on the Agriculture Department to promote corporate farming by private and state-run companies.

Agbon said the government had initially identified about 100,000 hectares as priority one areas in Luzon and Mindanao and 480,000 hectares of priority 2 lands, which are being recommended to San Miguel and Kuok.

She said potential areas for crops include the Mountain Province, Zamboanga del Norte, Zamboanga Sibugay and Saranggani.

Priority 2 areas for development cover a total of one million hectares. The lands are in the provinces of Isabela, Mindoro Oriental, Mindoro Occidental, Negros Oriental, Bukidnon, Davao Oriental, Sultan Kudarat and Surigao del Sur.

Kuok Group of Companies chairman Robert Kuok, Malaysia?s richest businessman, and San Miguel president Ramon Ang signed a joint venture agreement last year.

San Miguel and the Kuok Group committed to cooperate to provide the ?financing, technical support and management for agricultural crop production.?

San Miguel and the Kuok Group plans to purchase the farm produce in the areas at ?guaranteed production off-take? terms.