Rm210mil A Year For Treated Water From Perak To Penang Competitive Says Exco

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Executive councillor Zairil Khir Johari says PBAPP determined this after comparing the cost with that of the Sungai Perai water treatment plant under development.
Penang infrastructure, transport and digital committee chairman Zairil Khir Johari said the MoU signed with Perak for treated water will be followed by discussions and negotiations, before an official agreement is signed. (Facebook pic)GEORGE TOWN: The RM210 million per year offered for the supply of treated water from Perak to Penang through the Perak State Development Corporation-Gamuda Bhd joint venture (PKNPk-Gamuda JV) has been described as “competitive” by Penang executive councillor Zairil Khir Johari
The infrastructure, transport and digital committee chairman said Penang Water Supply Corporation Sdn Bhd (PBAPP) conducted due diligence, comparing the project’s cost if it were to be built on a build-operate-transfer basis with that of the Sungai Perai plant currently being developed.
“PBAPP found that the cost offered by PKNP-Gamuda JV was competitive after taking into account all costs, including the cost of constructing the plant, land acquisition, the pipe system to be connected from the plant around Bukit Merah to Sungai Kerian in Penang, financial costs, maintenance costs and infrastructure upgrades for 40 years.
“The annual capacity charge of RM210 million will be borne by PBAPP as part of the water purchase cost, and is part of the operating expenditure,” Bernama reported him as saying when winding up the debate on the Supply and Development Estimates Bill 2026 (State Budget 2026) for his portfolio at the Penang state assembly today.
On Nov 6, PKNPk-Gamuda JV and PBAPP signed a memorandum of understanding (MoU) for the sale of surplus treated water from the Northern Perak Water Supply Scheme to Penang.
Zairil said the MoU’s technical details included an annual capacity charge of RM210 million per year, as well as a treated water supply charge of RM1.70/m3, a minimum supply quantity of 300 MLD and a 40-year agreement period with a rate review in the 21st year.
He also said the MoU was non-binding and aimed to explore the potential for long-term business cooperation involving the sale, provision and purchase of water from Perak.
“This MoU will be followed by discussions and negotiations, before an official agreement is signed.
“The official agreement will later require approval from various parties including the board of directors, shareholders, financial institutions and authorities such as the National Water Services Commission and Bursa Malaysia,” he said.
Zairil also said the federal government would pay an estimated RM5 billion to build infrastructure for the intake and transfer of raw water from downstream of Chenderoh Dam to Bukit Merah through a tunnel in the hill, while the cost of treated water infrastructure was the state’s responsibility. - FMT

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