top of page

New Developments in Penang

Penang Monorail Project

Penang, supposedly located within the government’s NCER (Northern Corridor Economic Region), is in the limelight again this time because of potential spin-offs from the implementation of the NCER programme under the 9th MP (Malaysia Plan 2006-2010).

Under the government’s NCER programme, the Penang Monorail and Penang 2nd Bridge projects are two of the most significant projects in this part of Peninsular Malaysia. The Universiti Sains Malaysia Institute of Graduate Studies (USM-IGS) deputy dean Associate Professor Dr Ambigapathy Pandian opined that Penang can become the region’s educational hub if it can improve its accessibility manifold by the construction of the Penang Monorail and the Second Bridge.

MRCB (Malaysian Resources Corp Bhd), a prominent infrastructure and property development company, is working in consortium with Penang Port Sdn Bhd (PPSB) for the Penang Monorail project. PPSB was invited into the consortium because MRCB realised that a good portion of the land on which the monorail was to be constructed, belonged to PPSB. On top of that, PPSB had a better understanding of traffic flow problems in Penang than any other party to this development.

The participation by PPSB provides great support to MRCB’s portfolio as a competent candidate for the monorail project. Other members of the MRCB consortium included MTrans Transportation Systems Sdn Bhd, which specialised in the manufacture of urban buses and monorail transportation system, and Scomi Engineering Bhd, which owns a 51% stake in MTrans.

MRCB said it could plan the monorail system in Penang to complement with the routes of the Penang Outer Ring Road (PORR) project in order to achieve the maximum synchrony. MRCB is also believed to be negotiating a 70% stake in Peninsular Metro Works Sdn Bhd, which is the concessionaire holder of the PORR project.

Phase 1 of the Penang Monorail project includes an 18km stretch from the Penang International Airport to the Raja Tun Uda Ferry Terminal on east end Georgetown while Phase 2 comprises the 8.5km stretch from the said ferry terminal to Paya Terubong while the final phase is the 14km stretch from Komtar to Tanjung Tokong.

Penang Outer Ring Road Project (PORR)

The 34-year concessionaire holder of PORR (Peninsular Metro Works Sdn Bhd) announced that the entire project was financed by a consortium of prominent banks, a) the Macquarie Bank, b) Affin Bank and c) Bank Pembangunan. Peninsular Metro Works, with a paid-up capital of RM5million, was incorporated in 1995 with the sole objective of constructing and operating the Penang Outer Ring Road project for 34 years.

The PORR is a 17.2 km two-lane dual carriageway that is designed for vehicle speeds of up to 80kph. Some 11km of the highway will be elevated to accommodate an 8 km double-decker road and the entire highway is expected to have 4 toll plazas and 8 interchanges. Basically, the PORR will stretch from Tanjung Bungah in the northern side of the island to the Penang Bridge on the eastern flank of the island. The development cost of the PORR, including the reclamation of about 500 acres of land at Gurney Drive, is estimated at around RM1.2 billion.

24 km 2nd Penang Bridge

Malaysia is set to secure a loan of RM2.7 billion from China for the construction of the much-touted second Penang Bridge, the largest for any single project given to a foreign country by China.

It was learnt that during a closed door meeting in late 2006 between Abdullah and Chinese Premier Wen Jiabao in Naning, China, the former sounded out the possibility of securing a loan from the latter to build a second road bridge to ease traffic flow for Penang. For the record, Malaysia was the first Asean country to initiate formal political ties with China, a communist giant in this part of the world.

United Engineers Malaysia (UEM), the infrastructure development company, has been appointed to build in collaboration with China Harbour Engineering Company (CHEC), and to manage and operate the new bridge solely. CHEC is one of the foremost bridge-builders in the world and had constructed some of the longest bridges in the world.

On Fri, 13th July 2007, the 2nd Bridge agreement was signed between UEM Group Bhd, JV Consortium of China Harbour Engineering Company (CHEC) and UEM Construction. Chinese Minister of Commerce Bo Xilai, who witnessed the signing ceremony of the agreements together with Penang Chief Minister Tan Sri Dr Koh Tsu Koon and 2nd Finance Minister Tan Sri Nor Mohamed Yakcop said Chinese Premier Wen Jiabao and Prime Minister Datuk Seri Abdullah Ahmad Badawi had pushed for the project to be realised. It was learnt that the Chinese government was willing to give this loan with favourable interest rates because of the close ties between Malaysia and China.

The Exim Bank (Export & Import Bank of China) is a state-run bank that provides financing for export, overseas construction and investment projects and the only arm to issue low-interest loans. The bank is under the direct leadership of China’s State Council. It is believed that the 24km second Penang Bridge, which will link Batu Kawan on the mainland to Batu Maung on the south-eastern part of Penang island, is set to bring on a substantial spill-over effect for the state and its neighbours, especially in the property and transportation sectors. The bridge, touted to be the longest in Southeast Asia, is expected to ease congestion on the present 13.5km long 1st bridge, which is already 22 years old.

Malaysia obtained an RM2.7 billion loan from China for the construction of the 2nd Penang Bridge under the 9th Malaysia Plan (2006-2010) in mid July 2007. The agreement allowed for a 20-year repayment term at an annual interest of 3%. The loan facility is the largest given by China for a single project to a foreign country to-date. This project will be the catalyst for economic growth in the Northern Corridor for the next few years to come.

The new bridge will have a four-lane dual carriageway with two observation platforms that are designed to resemble a pearl at the central span. Construction on the bridge is expected to commence in early 2008, with the official opening scheduled 3 years later in 2011. About 17km of the bridge would be over water and the remainder over land. It is currently the longest bridge in Southeast Asia. The second bridge is among the several projects proposed under the Northern Corridor Economic Project (NCEP) to turn the state into a regional transportation hub that includes the setting up of a low-cost carrier terminal at the Penang International Airport and the expansion of the Penang port itself.

According to Sun Ziyu, president of CHEC, the significance of the 2nd Penang Bridge goes beyond its tourism potential. It will also double as the best showcase of China’s expertise in bridge-building. The bridge is CHEC’s largest overseas project in terms of contract value.

Prime Minister Datuk Seri Abdullah Ahmad Badawi is expected to unveil the massive development projects to the public in the news media. These development projects include modern methods of agricultural science for the northern states of Kedah and Perlis and for the provision of foreign expertise to hone local human skills for the northern Perak region.

It is believed that these projects, together with the network of roads under the Penang Outer Ring Road (PORR) programme and the public transport system upgrade, are essential factors that must be considered and adhered to before the roll-out of the other projects in the region.

Featured Posts
Recent Posts
Search By Tags
No tags yet.
Follow Us
  • Facebook Basic Square
  • Twitter Basic Square
  • Google+ Basic Square
bottom of page