Friday, July 02, 2010

New LCCT to be bigger than planned

The new permanent low-cost carrier terminal (LCCT) that will be ready by March 2012, will be bigger than previously planned. However, details of the revised cost, size and capacity of the new LCCT have yet to be announced by Malaysia Airports Holdings Bhd (MAHB).

Managing director Tan Sri Bashir Ahmad said MAHB can only reveal the details when the tender exercise for the terminal is closed.

"Now, we are still doing the tender exercise," he told a news conference after the launch of the KL International Airport's (KLIA) 12th anniversary celebration in Sepang yesterday. Also present were MAHB chairman Tan Sri Dr Aris Osman and senior general manager (operations services) Datuk Azmi Murad.

The original cost of the new LCCT project was RM2 billion. The terminal is expected to cater to 30 million passengers per year, with potential capacity for 45 million passengers per year.

Bashir said the delay in the completion of the new LCCT building was due to the open tender process and the building design which had be to be re-done. The open tender exercise for the terminal has taken three months longer than expected.

"Secondly, the building that we are going to build right now is much bigger than the original building. Because of this, we have to do another design to cater to the larger building," he said. Asked when the tender will be closed, he said: "It'll be soon."

To date, MAHB has awarded two contracts for the new LCCT project. The first, worth RM362 million, was given to WCT Bhd last December for site preparation, earthworks and main drainage. In January, a RM291 million contract was awarded to Gadang Bhd to carry out earthworks for the runway and taxiways.

On the development of the sukuk and bond to be issued by MAHB to fund the development of the new LCCT project, Bashir said the company will announce details of the fund-raising exercise later. It was earlier reported that the airport operator plans to issue sukuk and bond with a combined value of RM2.5 billion. It was said that the pricing and tenure of the bonds will be determined during the roadshow, which was supposed to start sometime in the middle of June.

On whether MAHB and its partner GMR Infrastructure Ltd is bidding for more overseas airport projects, following the recently clinched Male International Airport contract in the Maldives, Bashir said, "Not at the moment". Bashir also denied news reports that MAHB is part of a Malaysian consortium participating in the development of the Diosdado Macapagal International Airport in Pampanga province, the Philippines.

He said MAHB, together with Saudi Arabia companies, are currently bidding for the Madinah international airport. Besides Male airport, MAHB, which operates 39 airports in Malaysia, has three other overseas airports in its portfolio.

On contribution from overseas airport projects, Bashir said returns can only be realised after the fourth or fifth year of operations. "Normally, the concession period for airports is about 20 years, so normally the first three years is where you start investing money and the returns will come after the fourth or fifth year," he added.

Source : BusinessTimes

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