Malaysian, Chinese firms Interest in Penang airport expansion


GEORGE TOWN: At least six companies, including two from China, are said to be interested to be part of the expansion of the RM1.2bil Penang International Airport (PIA).

Sources said MALAYSIA AIRPORTS HOLDINGS BHD (MAHB) is likely to call for a request for proposal for the development of the PIA in the second quarter of the year.

Of the six, four are local companies, namely, Ideal United Bintang International Bhd (IUBI), Muhibbah Engineering Bhd, GAMUDA BHD and AIRASIA Group Bhd. The two Chinese companies are China Railway Engineering Corp (CREC) and another China construction firm.

The project is expected to be awarded in the third quarter so that construction works can proceed in the final quarter of the year. It is likely that some of the companies can partner each other to bid,” the sources added.

Under the private finance initiative (PFI) terms and conditions, the successful party will build and operate the expanded PIA for 30 years before transferring it back to the federal government.

Part of the deal includes the acquisition of 20 to 30 acres of land in the surrounding area to expand the airport.

Currently, MAHB is said to be revising the plan to expand the PIA to accommodate 16 million passengers per annum.

There was an earlier proposal to expand the capacity of the airport to accommodate 12 million passengers at a cost of RM800mil. The current airport was built to cater to 6.5 million passengers a year, although it handled 7.7 million passengers last year.

The new airport will have ample space for 40 aircraft, comprising 10 Boeing 777 aircraft, 26 smaller planes and four propeller planes.

On March 3, Finance Minister Lim Guan Eng said the PIA would be expanded at a cost of about RM1.2bil to accommodate 16 million passengers.

He had then said the development would be funded via a PFI, with contributions by the private sector.

“We are planning to use the PFI model for the construction of other airports in the country, as it would save the government a lot of money,” Lim had said.

The expansion would boost the economy, especially the tourism sector, as more international airlines are expected to fly into Penang.

However, the existing MAS cargo complex will not be moved. There are plans to expand the Penang Development Corp’s (PDC) second air cargo complex in Batu Maung.

“PDC has acquired more than 90 acres for the expansion project,” the sources said,

A RM90mil multi-storey car park at the PIA is also under construction and is expected to be completed by November.

IUBI is primarily a property development company with multiple projects in Penang. Muhibbah Engineering is engaged in providing oil and gas, marine, infrastructure, civil and structural engineering contract works.

Gamuda is the largest shareholder in the SRS consortium. The consortium is overseeing the implementation of the RM4.6bil Penang Transport Master Plan. AirAsia is Asia’s largest low-cost carrier and has indicated that it would prefer an airport that could keep its cost low.

CREC is a state-owned holding company of China, which is under the supervision of the state council.

The Penang state government has been seeking federal government funds to expand the PIA to serve as a low-cost carrier terminal.

The airport, which was plagued by flash flood problems, was enlarged in 2012 to meet its current capacity of 6.5 million passengers.

The capacity was supposed to be sufficient until 2020, but exceeded to 7.8 million passengers last year, making an expansion necessary with the increasing passenger traffic year-on-year.

Aside from the PIA , Kedah is also to get its first international airport in Kulim. The government plans to use the PFI model for the construction of other airports in the country. This will help save the government a lot of money.


   

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