KUCHING: Hock Seng Lee Bhd (HSL), which secured two mega road construction and sewerage contracts worth some RM2.45bil recently, has tendered for an additional RM500mil worth of projects.
Corporate affairs director Sonja Gan said the company was awaiting the outcome of its bids for several infrastructure projects in Sarawak.
Under the 2016 budget, the Sarawak government has allocated nearly RM6bil to fund development projects such as roads, the supply of treated water to rural communities and drainage.
“Tendering (for contracts) is an ongoing process at HSL as we still have the capacity to do new jobs,” Gan told StarBiz, noting that the company’s current orderbook of RM2.7bil was the biggest ever since its listing on Bursa Malaysia in 1996.
In March, the HSL-Dhaya Maju Infrastructure (Asia) Sdn Bhd joint venture (JV) was awarded the Pan Borneo Highway work package 7 worth RM1.71bil. HSL has a 70% stake in the JV. Via a 75%-owned consortium, HSL also clinched an RM750mil contract for phase II of the Kuching centralised wastewater management system project.
Gan said these two mega contracts, which would stretch until 2022, would set the group up for strong growth.
She said the group typically had some 30 ongoing projects of varying sizes and natures in hand, though the number exceeded 40, including property development, at end-2015.
“Typical construction projects range from 18 months to three years. Our turnover rate has been consistent with projects in and projects out.
“HSL has a long track record of successful contract execution throughout Sarawak, and we have proven our technical merits and cost-competitiveness across a range of marine and civil engineering works.
“We are highly experienced and strategic in our planning and remain active in the procurement of projects drawn on our core strengths,” she added.
In 2015, HSL completed 16 projects while securing 21 new contracts worth a combined value of RM275mil. About 75% of the new contracts came from the Sarawak Corridor of Renewable Energy region of central Sarawak. The contracts include the Balingian power plant’s administrative offices in the Mukah Division, Government offices in Samalaju, Bintulu, as well as water and road works associated with the Tanjung Manis halal hub.
On the Pan Borneo Highway package 7 contract, Gan said the project covered a 76-km stretch from the Bintangor junction to the Julau junction and Sibu Airport to Sg Kua Bridge.
In the main portion, this will comprise the upgrading of the existing single carriageway to dual carriageway of higher specifications.
Bridges and interchanges are also part of the package, including the 1.7-km long Durin Bridge across Rejang River, Malaysia’s longest. The delivery period of the contract is 51 months.
Gan said the HSL-Dhaya Maju Infrastructure JV would source the construction materials like cement and steel locally to avoid exposure to the risk of foreign currency exchange rates.
“HSL is well versed in the logistics of materials supply,” according to her.
The Kuching centralised wastewater phase II project will involve the expansion of the sewerage treatment facilities, new underground trunk lines and connecting up to a considerable section of properties in northern Kuching.
Package 1 (2008-2015) was made up of three key components - a wastewater treatment plant, a sewer network (overall length of 64.5km consisting of trunk, secondary and tertiary sewers) and property connections.
The ambitious project, which is based on the Singapore model, is to collect grey and black water and pipe it underground to the treatment plant, where it is processed into clean water before being discharged back into the environment.
The untreated water was previously discharged into Sarawak River where the Kuching Water Board draws its raw water for treatment.
So far, some 2,830 commercial and residential properties have been connected.
For the financial year ended Dec 31, 2015, HSL recorded a group revenue of RM654.7mil and a pre-tax profit of RM101.2mil.