Kemaman Port privatisation expected in 2H
By Yap Lih Huey, The Edge Daily

Eastern Pacific Industrial Corporation Bhd (EPIC) may realize the privatisation of the East Wharf of Kemaman Port in the second half of this year after a three-year delay, says EIC chairman Datuk Mohamed Awang Tera.

He said the proposed privatisation, which would be undertaken by the Kemaman Port Consortium Sdn Bhd, was in the final stages of getting approval from the relevant authorities. The consortium comprises EPIC with 51%, Road Builder (M) Holdings Bhd 39% and Perwaja Steel Sdn Bhd 10%.

Since 1998, EPIC’s subsidiary Pangkalan Bekalan Kemaman Sdn Bhd has been entrusted by the Kemaman Port Authority to manage the East Wharf of Kemaman Port and will continue to do so until the privatisation goes through.

The privatisation plan has been held back by lengthy government processes. Mohamed Awang said the government had agreed to the privatisation in principle.

“We are now waiting for the Economic Planning Unit to put together a paper for Cabinet approval. We are pursuing it very hard now for it to materialize in the second half,”he told reporters after the company’s AGM and EGM in Kuala Lumpur on June 16.

He said under the privatisation plan, the consortium would get a 60-year concession, which was revised upwards from the 30-year period in an earlier proposal. It would have the option to increase tariff every five years and the flexibility to lower the tariff.

The tariff would be divided into two types of charges, which is dependent on volume and type of cargo-liquid and dry bulk. On average, local ports are charging around RM6 per tonne for liquid cargo and RM10 per tonne for dry bulk.

Mohamed Awang said the privatisation would start to contribute positively to the group for its financial year ending Dec 31, 2007. The port could serve as its transshipment hub, which is in tandem with the group’s strategy to expand its supply base operation overseas.

The Kemaman Port is an all-weather port with a quay length of 648 metres. The port is able to handle vessels up to 150,000 dead weight tonnes.

Mohamed Awang said EPIC group was looking for opportunities in Indonesia and Africa by riding on local companies’ expansion plans.

They include Petroliam Nasional Bhd’s exploration in Indonesia and Seloga Holdings Bhd’s 55% stake in West Africa’s Dome Flore offshore petroleum licence.

He said EPIC had identified an Indonesian joint-venture partner to build an integrated supply base in Balikpapan, Kalimantan and was in the midst of conducting a technical study.