Penang shareholders back Perak water deal, clearing key hurdle for 2032 supply

GEORGE TOWN, Nov 12 — A majority of PBA Holdings Bhd’s shareholders have approved Penang Water Supply Corporation’s (PBAPP) proposal to purchase a minimum of 300 million litres per day (MLD) of treated water from Perak starting in 2032.

PBA Holdings and PBAPP chairman Chow Kon Yeow said PBA has obtained the approval needed to fulfil a condition precedent in the Bulk Water Supply Agreement (BWSA) between PBAPP and Prasarana Air dan Irigasi Perak Sdn Bhd (PAIP).

“At this general meeting, the board of directors’ proposal was approved by a majority vote, with 97.93 per cent voting in favour of PBAPP’s proposed purchase of treated water under the Penang-Perak Water Supply Scheme, as we have announced many times,” he said at a press conference after an extraordinary general meeting attended by shareholders today.

He said that after obtaining the approval, PBA will inform Bursa Malaysia and PAIP so that steps can be taken to commence the project.

“Under the agreement, we have a date for receiving the treated water — March 31, 2032. That is the date by which the project must be completed and treated water delivered to Penang, or to PBAPP, up to the Perak-Penang border and beyond that point, it is PBA’s responsibility to distribute the treated water we receive from Perak,” he said.

Chow, who is also Penang chief minister, said a group, representing minority shareholders, had submitted a letter in advance raising issues that was addressed during the meeting.

“Apart from the minority shareholder group, the other shareholders present did not raise any additional questions beyond those raised by the group,” he said.

As for the setting of water tariffs, Chow said this was already specified in the BWSA and that PAIP must fulfil one of the pre-conditions in obtaining approval from SPAN for the proposed tariff.

“That could also cause the project to fail. If Perak does not obtain SPAN’s approval for the proposed tariff, and for the capacity charge and other charges to be collected through the water tariff, the agreement will not proceed,” he said.

He said Perak has until 2035 to obtain SPAN’s approval for the tariff.

”If they cannot do so, we can say that we are walking away because SPAN has not approved it. They would then have to go back to SPAN and propose a new tariff until SPAN accepts the proposal,” he said.

He said this is a condition precedent of the agreement that Perak has to fulfil before the project can proceed.