GEORGE TOWN: The Penang government has again questioned the delay in the North Channel dredging project, which is crucial for Penang Port Sdn Bhd’s cargo business but has been on hold for years.

Chief Minister Lim Guan Eng said there was no news about the RM353 million project, which will see the North Channel seabed deepened to 15m to allow large cargo vessels to enter the port.

He said the dredging project was an obligation of the port, which was previously owned by the Finance Ministry before it was privatised to Seaport Terminal Sdn Bhd last year.

“No work on the dredging has started yet. It is an obligation of and a necessity for the new owner of the port to do it.

“When is Penang Port going to spend the money to do it?” he told a press conference at the Penang Development Corp Chinese New Year open house yesterday.

Guan Eng was commenting on a report in the latest issue of The Edge weekly which quoted Penang Port chairman Datuk Mohd Sidik Shaik Osman as saying that the port was doing better.

Operating costs were cut, he said, adding that the port might even break even or see a slight profit.

The port has yet to release its figures for the financial year ended  Dec 31 last year. In 2013, the port operator recorded after-tax losses of RM9.1 million on revenue of RM345.8 million.

At the end of December 2013, the port had debts of almost RM910 million while its current liabilities stood at RM461.9 million. It had non-current assets of RM1.7 billion and current assets of RM96.8 million.

In The Edge report, Mohd Sidik was also quoted as saying that even with its plan to increase the ferry fares, the port would still see losses of RM17 million a year.

Two weeks ago, it was reported that the Penang Port Commission (PPC) is proposing to review the ferry rates for pedestrians and motorists using the service to travel between the island and the mainland.

According to the proposal, the motorcycle fare will be up from RM2 to RM3.50, and those for cars  from RM7.70 to RM9, pedestrians from RM1.20 to RM2 and bicycles from RM1.40 to RM1.50. Seasonal tickets for students and adults will also be increased to RM6 from RM3, and from RM30 to RM50 respectively.

Guan Eng said it was likely fares will be increased, which he reiterated was unjustifiable when the present ferry service badly needed improvement.

“They should be improving the ferry service first, not proposing to hike up the fares. That is why the state is proposing to take over the running of the ferries.

The Pakatan Rakyat state government had in late 2012 proposed to take over the port’s Tanjung City Marina, Swettenham Pier and the ferries. — The Malaysian Insider

This article first appeared in The Edge Financial Daily, on March 4, 2015.