Kuala Linggi International Port’s expansion to commence in 1Q20

The RM15b development will be rolled out in 5 years, funded by DDI and FDI


TAG Marine Sdn Bhd is expected to begin work on the RM15 billion Kuala Linggi International Port’s (KLIP) expansion project by the first quarter of 2020 (1Q20).

KLIP CEO Datuk Muhammad Saifullah Noor said the development will be rolled out in five years, funded by domestic direct investment (DDI) and foreign direct investment (FDI).

Muhammad Saifullah said the DDI is mainly provided by the company, while various foreign investors including from China, Belgium and the UK are involved in the FDI.

He said the second phase of the KLIP development would entail, among others, a 620-acre (251ha) land reclamation and a 1.5 million cu m tank farm construction.

“We have more than 400 clients today and thus, KLIP has the demand already. The 1.5 million cu m tank farm is for ready clients to meet their expectations and demand,” he said at the service agreement signing ceremony between TAG Marine and Euronav NV for the provision of home port, bunkering hub for low sulphur fuel and marine services in Kuala Lumpur yesterday.

The private port development plan had previously faced roadblocks due to environmental impact concerns and state maritime border considerations.

Muhammad Saifullah said the project plan has recently received a conditional approval by the National Physical Planning Council and it expects a development order to be issued by end of this month.

“We want to do onshore business with the new phase of KLIP development. The land reclamation is expected to be completed in 48 months, excluding infrastructure,” he added.

Established in 2001, the KLIP provides ship-to-ship cargo transfer services mainly for oil tanker ships.

The port, situated near the river-mouth of Sungai Linggi, Melaka, has received over 6,000 ship calls and facilitated more than 500 million barrels of liquid bulk cargo transfer as of Oct 2019.

The service agreement inked with Euronav, the world’s largest independent tanker company, is a long-term strategic collaboration to develop a home port, bunkering hub for low sulphur fuel and marine services at KLIP for up to 10 years.

The partnership is in line with the International Maritime Organisation’s new regulation of 0.5% global sulphur cap for marine fuel that will take effect on Jan 1, 2020.

Under the new global cap, ships will have to use marine fuels with a sulphur content of no more than 0.5% against the current limit of 3.5% to reduce sulphur oxides emissions.

Transport Minister Anthony Loke, who witnessed the signing ceremony, said the new collaboration would play a role to make Malaysia a bunkering hub for ships.

He said the country is well-positioned to be a bunkering hub and a place for refuge for international shipping through the Straits of Melaka.

The Straits of Melaka sees over 85,000 ship transiting annually to ferry international trade between the West and East, making it among the world’s busiest straits.

Euronav, an Antwerp, Belgium-headquartered crude oil tanker company, has more than 70 vessels including two floating storage and offloading vessels, two V-Plus, 43 large crude carriers and 25 Suezmax ships.