23rd December, 2014
BENALEC Holdings Bhd, a marine construction services provider, said its land reclamation project for 1MY Strategic Oil Terminal Sdn Bhd in Tanjung Piai, Johor, has been delayed on the client’s request. “The project was put on hold, based on our client’s request.
We were informed by them that they needed some time to iron out some of the terms and conditions in the agreement,” Benalec chief operating officer Desmond Boey said after the company’s annual general meeting yesterday. Boey declined to reveal further details.
Benalec has extended the term sheet validity period for the signing of the land reclamation deal for another six months from December 12 until June 11.
It had announced to Bursa Malaysia that its 70 per cent-owned Spektrum Kukuh Sdn Bhd had entered into a binding term sheet with the State Secretary, Johor, and 1MY Strategic to undertake the reclamation works and the sale of about 404.6ha off the coast of Tanjung Piai for the development of a crude oil and petroleum storage facility together with a private jetty.
The 404.6ha of reclaimable land is estimated between RM2.5 billion and RM3 billion.
Boey said its land reclamation contract is awaiting approval from the Environmental Impact Assessment (EIA).
He said the delay will not pose a big impact on Benalec for now as it still has projects in Malacca until 2017.
Boey added that the Tanjung Piai job, as well as another reclamation project in Pengerang, Johor, will open up doors for recurring income, providing strong growth and investment opportunities.
On land sales, Benalec in December had sold 23.4718ha worth about RM100 million, which will be recognised in 2016.
The company is looking at expanding its landbank and future projects mostly in the east coast of Peninsula Malaysia.
“We are eyeing not just land reclamation projects but also dredging and other marine based construction projects,” said Boey.
Benalec posted a lower profit of RM7.1 million in the year ended June 30 2014 from RM56.6 million last year.