ASEAN Ports Association Malaysia (MAPA)

Middle Eastern investors may invest some RM1.5 billion in a petroleum tank farm and halal industrial park in Penang Port.

Penang Port Sdn Bhd (PPSB) chairman Datuk Seri Dr Hilmi Yahaya yesterday said potential investors have approached PPSB to set up shop in the port area to tap the export potential of the Indonesia-Malaysia-Thailand Growth Triangle.

“We are looking at reclaiming some 400 hectares of land to accommodate the proposed tank farm and halal hub.

“We also have plans to house a free commercial zone and free industrial zone within the port area to facilitate the easier movement of goods for investors,” Dr Hilmi told reporters after a Penang Port Commission port consultative committee meeting chaired by PPC chairman Tan Cheng Liang.

The closed-door meeting, which was attended by officials from the finance and transport ministries and the Economic Planning Unit, was also attended by Penang port users.

The proposed area for land reclamation would be south of the Butterworth Port on mainland Penang.

“Since we have received positive indication of the port’s RM350 million request from the federal government to carry out capital dredging works under the 10th Malaysia Plan, we are hoping that the sand from the dredging activities can be used for our land reclamation purposes,” he said.

The north channel dredging of the port, from its current 11.5m depth to 14.5m, was supposed to be carried out between 2010 and 2012 to serve main line operators calling at the port.

However, the government deferred the project in its mid-term review of the Ninth Malaysia Plan.

Dr Hilmi noted the tank farm is likely to bring in a RM1 billion investment, while the proposed halal hub will rake in an estimated RM500 million.

“We are looking at potential investors to help us finance this project,” he added, “since we do not want to borrow any funds.

“We have had interest shown by parties from China and the Middle East so far to help us in the funding,” he added.

Several investors – such as those engaged in liquid crystal display production – have stated that they want to be located in an area where shipping of the goods can be seamless.

“Our next step would be to call in all interested parties to map out a detailed plan, before we proceed with obtaining permission from the federal authorities via the finance and transport ministries.”

Dr Hilmi, a former finance ministry parliamentary secretary, gave an assurance that the proposed Penang Port expansion plan would in no way end up like the scandal-hit Port Klang Free Zone project in Selangor.

By: Marina Emmanuel

By forming a new subsidiary to manage its ferry business, Penang Port can make strategic moves at turning around the unit, says its managing director

The Economic Planning Unit (EPU) has given the much-awaited nod to terminal operator Penang Port Sdn Bhd (PPSB) to separate its loss-making ferry operations from its core port business, and make it a subsidiary of the company.

The move by the EPU, a body established under the Prime Minister’s Department, is part of a major restructuring plan aimed at facilitating the port operating unit’s listing on Bursa Malaysia.

PPSB managing director Datuk Ahmad Ibnihajar said the separation of the two businesses, which is likely to take place this year, will create distinct identities for PPSB’s ferry and port operations.

“This restructuring exercise is expected to be endorsed by PPSB’s board when it meets on October 9 and we are looking at positioning the ferry operations as a public transport provider like Rapid Penang and the light rail transit service,” he told a press conference in Penang yesterday.

Present was PPSB’s newly-appointed chief operating officer Azlan Hamid.

Ahmad said by forming a new subsidiary to manage its ferry business, PPSB can make strategic moves at turning around this unit.

“One way to fill our fleet of eight ferries up and ensure that they run optimally is to team up with Rapid Penang.

“We plan to load their buses on our ferries – which currently operate at only 25 per cent capacity – and allow passengers to travel on a single ticket,” he added.

He said discussions on the fare structure for this proposed merging of services between PPSB and Rapid Penang will be held with Rapid Penang’s chief executive officer Azhar Ahmad soon.

The ferry service, which links Penang island to the mainland, has been a stumbling block to the port opera-ting company’s initial public offering.

Last year, ferry losses stood at RM24.6 million, a 71 per cent increase over RM14.4 million in 2007.

“The massive losses last year were due to fuel cost. We are looking at losses of RM14 million this year,” Ahmad said.

In July this year, Second Finance Minister Datuk Seri Ahmad Husni Mohamad Hanadziah was reported as saying that state infrastructure company Syarikat Prasarana Negara Bhd had been given the mandate by the Finance Ministry to carry out a study on the viability of taking over the ferry service from PPSB.

The public ferry service was absorbed into PPSB as part of its corporatisation deal with the Penang Port Commission in January 1994. Some 6,500 passengers and 3,000 vehicles use the service daily. Passengers pay RM1.20 each, while the fare for a car is RM7.70.

Meanwhile, Ahmad said Penang Port’s container throughput for 2009 is expected to match the 2008 volume of 929,639 TEUs (20-foot equivalent units).

By Marina Emmanuel