PORT Klang Authority (PKA) is working towards diversifying its income stream in an effort to bear the costs of running both Port Klang Free Zone (PKFZ) and its own operations.

“Of course, now we are currently self-sufficient, but with the PKFZ loan to the service, we will have to come up with more revenue streams to generate income,” PKA general manager Kee Lian Yong told Business Times recently.

He was appointed in June to replace Lim Thean Shiang, who resigned earlier amid reports of a fallout with Transport Minister Datuk Seri Ong Tee Keat over the handling of the PKFZ controversy.

Lim was handpicked to take over the running of the port by the Transport Minister.

Kee, like Lim, was a member of the corporate sector, having headed listed companies such as Metroplex and Anglo-Eastern Plantations Plc.

He said the port authority is studying all options, but is mindful of its main role as trade facilitator.

“We believe there are a lot of opportunities. I would like to do more. As a man from the property sector, I can see that we have a lot of land here, and we have to look at how we can maximise the returns on that land,” Lee said.

He said rather than just concentrating on growing its bottomline, the port authority has to also consider initiatives that will enable the industry to grow.

Kee declined to reveal the amount of cash that PKA has in its coffers, claiming that its cash reserves did not correctly reflect the financial health of the regulator, considering its huge debts, because of PKFZ.

In 2008, it was reported that PKA’s main income comes from leasing of land under the port authority. The then general manager Datin O C Phang, had said that it made RM100 million per year.

Expenses on maintaining the port area, however, were said to come up to about RM80 million per year.

On his ambition for the port, Kee said he wants to create an equitable playing field for all players in the port industry.

“I don’t want to sideline any party. In fact I hope that we can build a supply chain that benefits everybody, and also promote the growth of the port industry,” Kee said.

By Presenna Nambiar

MARSEILLE: Malaysia’s liberalisation of 27 local services sub-sectors, including the transport sub-sector, prompted French shipping giant, CMA CGM to mull over plans to strengthen its foothold in the country.

Transport Minister Datuk Seri Ong Tee Keat had during a visit to the headquarters of the world’s third largest container shipping company in the French city last Thursday shared the Malaysian Government’s policy to liberalise the transport sub-sector, including the opening of 30% restriction in foreign ownership.

CMA CGM has had a presence in Port Klang since 1994 and is one of the largest customers of Port Klang. It has since June 1 also served the port of Tanjung Pelepas.

In welcoming the move, the company’s president Jacques R. Saade said “such liberalisation will change the strategy (of the company) in Asia.”

The shipping giant also welcomed Ong’s announcement of gradual liberalisation of cabotage of key sectors such as from Peninsular Malaysia to three major ports in east Malaysia, namely Sepangar, Kuching and Bintulu. (See also page 7)

Saade said the company would seriously explore the opportunities available from such a move. He also said the company would expand its dry port bonded warehouses, which include the Port Klang Free Zone.

Later, Ong visited the Port of Marseille, one of the oldest and busiest sea ports in France.

Marseille Port also raised its interest to establish an in-house university specialising in shipping and maritime as part of its education and training project.

Ong took the opportunity to test-drive its state-of-the-art port simulator.

By SHARIDAN M. ALI

Besides the private finance initiative model, the government may opt to use its own coffers for the project

THE government is exploring the possibility of using a private finance initiative (PFI) model to deepen the north channel of Penang Port.

Transport Minister Datuk Seri Ong Tee Keat said besides the PFI model, another alternative is for the government to use its own coffers for the project, which is estimated to cost RM1 billion.

He said a study is being carried out to determine the feasibility and suitability of both models.

“We will decide on the matter based on the outcome of the study. This is top on my priority list and I hope the engineering working proper will kick off before September this year,” he told reporters in Penang yesterday after launching the Penang MCA’s 60th party anniversary celebration.

The government had announced last November that it would resume work on the project, which had been shelved under the Ninth Malaysia Plan (9MP) mid-term review.

Ong had said then that after studying the benefits in dredging Penang Port’s channel, his ministry felt that the project should proceed in order to enhance the port’s competitiveness.

“The Penang Port is currently a feeder port. We should not forget its glorious past and the importance of the port to the country, the state and its people,” he said, adding that what worried him was the depth of the current port, which is between 9m and 11m.

“We hope to deepen the depth to between 15m and 17m to enhance the port’s competitiveness,” he said, adding that an environmental impact assessment (EIA) report will also be carried out before the project proper.

Operator Penang Port Sdn Bhd is targeting to develop Penang Port into a premier port by 2012 if the deepening of the north channel proceeds.

The Penang Port expansion and upgrading are outlined in the Northern Corridor Economic Region (NCER) blueprint to promote it as the leading port in the Indonesia-Malaysia-Thailand Growth Triangle.

Meanwhile, Ong who was also asked on a proposal by Bukit Bendera MP Liew Chin Tong for the Penang state government to take over the ferry operations which were reported to have suffered RM20 million losses last year.

“Anyone can propose anything but it should not be just a mere statement. Show us the proposal and we will see whether its viable or not,” Ong said, adding that he had received numerous inputs on the matter by various parties including the state MCA and individuals.

He added that so long as the proposal was genuine and for the benefit of the people, he was willing to consider it.

By : Audrey Dermawan

The cruise terminal is expected to be completed by September 30, says Transport Minister Datuk Seri Ong Tee Keat

PENANG is set to welcome larger cruise ships and passenger vessels by September, when the much-delayed redevelopment of Swettenham Pier is finally completed, Transport Minister Datuk Seri Ong Tee Keat says.

The project, which took off in May 2006, was originally scheduled for completion in April last year. Among its components is an international cruise terminal.

“The cruise terminal is expected to be completed by September 30. As of April 1, the project was 86.5 per cent completed,” Ong told Business Times via e-mail.

Last year, the Transport Ministry unveiled a discrepancy of RM3.5 million in a claim for progressive payment from the contractor of the redevelopment project for the pier.

Ong said in August that the contractor had sought RM5.4 million as progressive payment in documents dated March 21 last year when the value of the work was RM1.92 million.

He said the discrepancy was discovered a few days after he took over as minister.

It is now learnt that the project is likely to only exceed its RM65 million tag slightly, and that the original contractor is seeing to the completion of the project.

Sources said the contractor was not terminated because the project would be further delayed if new tenders are to be called, and there was a likelihood of the work costing considerably more.

“However, the ministry has laid very strict conditions on the contractor now, and one of them is that all sub-contracting jobs and payment are to be made by the Penang Port Commission (PPC),” a source said.

“The PPC is seeing to the necessary arrangements to ensure that the project is back on track,” Ong said.

“Liquidated and ascertained damages of RM15,000 per day are also being imposed on the contractor for the delay,” he added.

On when the new terminal will be open, Ong said: “It will be operational when it receives the occupational certificate from the local authorities.”

By : times.com.my

In June this year, the port community in Port Klang was surprised by the entry of little known Lim Thean Shiang as Port Klang Authority’s general manager.

Coming to a post that has traditionally been reserved for long-serving government employees, Lim was worried of only two things – the acceptance of PKA employees and the port community.

“They (PKA staff) were sceptical of me, because I was from the private sector and therefore had doubtful management skills,” Lim quipped.

He said direct and indirect feedback gathered has been very encouraging.

“I feel that they have taken to my management style. I believe in empowering the staff, have them chair meetings, make decisions… it’s a new culture for them.”

Lim was handpicked by Transport Minister Datuk Ong Tee Keat to head Port Klang Authority after the March general elections. The official appointment, how-ever, came two months later on June 6.

He put the two months to good use by visiting both Northport (M) Bhd and Westports Malaysia Sdn Bhd, as well as meet up with logistics players to get a better understanding of the industry.

The 37-year-old lawyer by training is not daunted by the mammoth task ahead of him though, as he points out that his task is to make sure that plans for Port Klang are on track.

“The plans for Port Klang still remain the same. The way I look at it… what is important is to put Port Klang back on the world map, to promote Port Klang and not the port operators.

“Both port operators must assist Port Klang in promoting us as Port Klang not as Northport or Westports,” Lim said

Besides continuing with the goal of making Port Klang the transshipment hub of the region, Lim plans to set out a 15-year strategic port development plan, which will map out the direction of both port operators in Port Klang and the kind of facilities and technology needed to develop both ports.

“I realise the efficiency of both ports are mainly reliant on the transportation infrastructure, especially the road infrastructure. So, we will put up the proposal to the Ministry of Transport, which will be most likely tabled in the 10th Malaysia Plan, to see how we can link up both ports,” Lim said.

He said the linkage would reduce internal transfer time as well as divert the movement of cargo trucks away from the public road system.

By : Presenna Nambiar