An informative post about Penang.


The Penang government today said that one of the three islands it plans to reclaim under a giant project in the south of the main island will now be handled by the private sector.

Chief minister Chow Kon Yeow said the state government had now decided to let the private sector fund the RM3.8 billion needed to reclaim the biggest of the three islands.

Under the earlier project delivery partner (PDP) model, the state was supposed to fund the entire project through a RM1.3 billion bridging loan. However, changes became necessary as that loan failed to get a guarantee from the federal government.

Chow said given the current economic situation due to Covid-19, the state had decided to allow the partner, SRS Consortium, to pay for the reclamation of the first island, “Island A”, on its own.

Island A is to be created in the waters right next the Penang airport runway, near Permatang Damar Laut.

To facilitate the creation of Island A, a 30:70 share joint venture company would be created between state government-linked company Penang Infrastructure Corp and SRS.

This joint venture company would then create another firm to be the project developer and turnkey contractor.

Chow said the reclamation of Island A would be done in phases. Under the first phase, only 486ha of the total 930ha would be reclaimed, with an inverted E-shaped island created.



Gamuda Engineering would be appointed to reclaim Island A under the first phase. The company would “slow down” or “increase” reclamation as demand for land reduces or increases over time.

“This does not mean that the Penang South Reclamation (PSR) project is now private. The reclaimed land would remain the property of the state government,” he said at a press conference here today.

Chow said the joint venture model would only apply to Island A, while the PDP model would be used for the other two islands and projects under the Penang Transport Master Plan, such as the light rail transit and highways.

He said preliminary survey and soil investigation works would be carried out on March 29 in the area concerned.

SRS’ Szeto Wai Loong said Island A would be 70% public transport-based and built with environmental, social and corporate governance so as to attract investors.

He said the island would see a smart industrial park created, where high-end tech industries are expected to take foot. Denmark-based Bjarke Ingels Group will be the lead masterplan designer for the island.

Szeto said they had obtained all required approvals from the Department of Environment, barring an environmental management plan, which he said was only required to be submitted before the actual reclamation took place.

The PSR, or three-island project, seeks to reclaim 1,821ha of land. The state plans to sell the land to the highest bidder to finance infrastructure projects worth RM46 billion, such as highways and a 30-station LRT line.

The project will be spread over 17 sq km, with islands covering 9.3, 4.45 and 3.23 sq km, to be reclaimed off the coast of Permatang Damar Laut.




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