KUALA LUMPUR (July 10): The Federal and Selangor governments have 60 days to complete the master agreement which will set in motion the restructuring and takeover of the state's water assets.

This follows the signing of a supplemental agreement among Pengurusan Aset Air Bhd (PAAB) chief executive officer (CEO) Datuk Faizal Abdul Rahman, Energy, Green Technology and Water Ministry (KeTTHA) secretary-general Datuk Loo Took Gee, Pengurusan Air Selangor Sdn Bhd (Air Selangor) CEO Suhaimi Kamaralzaman and Selangor state secretary Datuk Mohammed Khusrin Munawi in Putrajaya today. The event was witnessed by Deputy Prime Minister Tan Sri Muhyiddin Yassin, who is also the chairman of the Special Cabinet Committee on Selangor Water Issues, KeTTHA Minister Datuk Seri Dr Maximus Ongkili and Selangor Menteri Besar Mohamed Azmin Ali.

"Among other things, the supplemental agreement allows the water restructuring exercise to proceed without Selangor giving up its land while still complying with the requirements of the Water Services Industry Act, 2006," said Azmin in a statement today.

The water conflict between the federal and state governments has been dragging on for almost eight years.

The two governments had achieved some small success when they, together with PAAB and Air Selangor, had on Sept 12, 2014 signed a master agreement as part of the efforts to restructure and consolidate the water supply services in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya.

However, the master agreement, which was extended thrice, was left to lapse on March 9, 2015, due to disagreements over land issue.

In the original master agreement, Air Selangor was supposed to take over the operations and maintenance of the state's water treatment plants and water supply services, currently managed by the four concessionaires in the state – Splash, PNSB, Syarikat Bekalan Air Selangor (Syabas) and Konsortium Abbas Sdn Bhd.

The agreement would also have paved the way for the federal government to proceed with the RM3 billion Langat 2 water treatment plant project.

Azmin said to expedite Selangor's water restructuring exercise without further delay, the dispute on the ownership of the Sungai Semenyih and Bukit Nanas water treatment plants will now be addressed separately between the federal and state governments.

"The state has agreed to provide alternative water assets to PAAB in consideration for up to RM2 billion in funds to finance Air Selangor's acquisition of the private water concession companies in Selangor," said Azmin.

The extension of the completion date of the master agreement will also facilitate the completion of the sales and purchase agreement signed between Air Selangor and Puncak Niaga Holdings Bhd for the purchase the latter’s equity stakes in Syabas and Puncak Niaga Sdn Bhd.

On the delayed Langat 2 water treatment plant project, Azmin told reporters after the signing ceremony today, that the matter will also be dealt separately between the federal and state governments.

Ongkili said the federal government had decided to relax certain requirements without risking the assets of the government and to take the pipes without the land.

Meanwhile, Azmin said today's signing shows that the Selangor government "can work well" with the federal government when both parties are prepared to set aside extraneous concerns for the common good and welfare of the people.
 
“Despite the challenges and criticisms, all parties have demonstrated in the discussions and negotiations a serious commitment to work towards an amicable and sustainable resolution for the benefit of the rakyat,” he noted.
 
“Once the take-over and consolidation of the private water concession companies under state-owned entity Air Selangor is completed, all efforts will be focused on further improving the water treatment and distribution systems as well the overall water supply services," he added.