E&O to award STP2 reclamation job by July

e&o

-A +A

e&o_020315

GEORGE TOWN: Eastern & Oriental Bhd (E&O), a lifestyle property developer, will award a tender for the RM25 billion Phase Two of the Seri Tanjung Pinang (STP2) reclamation project by July.

Seven contractors have been shortlisted for the proposed reclamation project.

E&O deputy managing director Eric Chan Kok Leong said the group will select the successful bidder after the seven companies shortlisted submit their formal tender documents by the end of this month.

“Following our notice of pre-qualification of contractors for the proposed reclamation for STP2 that appeared on Dec 8 and 9 last year, we received a total of 17 submissions from local and foreign firms,” he told The Edge Financial Daily via email.

“From this, seven qualified contractors satisfied the comprehensive and vigorous pre-qualification conditions.

“We have notified the successful qualified contractors who will be submitting their formal tender documents by the end of this month,” Chan said.

The proposed STP2 project entails the reclamation of 760 acres (307.56ha) of sea land that will feature a 5km extension to the existing first phase of STP measuring 240 acres, and two islands separated by a 50m wide canal.

About 130 acres of the STP2 reclamation land will be handed over to the state, which will in turn use it to fund the RM6.3 billion integrated infrastructure project in a land swap deal with Consortium Zenith BUCG Sdn Bhd.

STP2, which is expected to be completed in 30 years, is part of the 980-acre reclamation project that E&O (fundamental: 1.5; valuation: 0.6) took over in 2003 after it was stalled in 1998 due to the Asian economic crisis.

According to reports, the reclamation project with an estimated gross development value (GDV) of RM25 billion will feature a mixed development and a marina.

Chan pointed out that the group is working within its timeline following the approval received from the Department of Environment (DOE) for its detailed environmental impact assessment (DEIA) report on April 10 last year.

On June 10 last year, the Penang state government endorsed STP2’s land-use master plan. This was followed by the group’s pre-qualification for reclamation exercise in December before it was closed in February this year.

On any possibility the proposed reclamation works would be affected as the DEIA of one of the sand mining companies in Perak had lapsed, Chan said the successful contractor was required to determine the location of the sand sourced.

“As stated in the pre-qualification document, it is the responsibility of the reclamation contractor to determine the location of the sand sourced for reclamation purposes,” he said. 

“The contractor is also responsible to obtain approval for the sand source from the DOE before dredging works commence,” Chan added.

In STP2’s DEIA report, 33.1 million tonnes of sand will be extracted from the coast of Perak from an area measuring 43ha and about 3,820 trips will be made over five years for this project.

 

This article first appeared in The Edge Financial Daily, on March 2, 2015.