May 13, 2013 [Malaysia Chronicle] - Marine construction company Benalec Holdings Bhd is close to inking two major deals for its land reclamation project off Tanjung Piai in Johor, which will translate into investments exceeding RM35 billion.
Benalec, which is 52.3 per cent owned by the Leaw family, has the rights to reclaim 1,410.3ha off Tanjung Piai.
The company sealed the deal with the Johor government last September as the state wants to develop the area as an oil and gas hub.
Benalec inked its first deal to reclaim 404.7ha and sell the land to the Abu Dhabi government in March.
Abu Dhabi, which holds six per cent of known crude oil reserve in the world and pumps an estimated 2.65 million barrels per day, will invest RM21 billion to build a crude oil and petroleum storage facility that is able to hold 60 million barrels of oil.
Abu Dhabi intends to store oil in Johor to tap the Asian market, where growth is fuelling demand for energy. It also wants to ensure supply in times of crisis in the Middle East by using Johor as the hub.
Brian Mak, Benalec’s business development manager, said the company is in talks with potential investors from Europe and the Middle East.
Benalec is also talking to independent storage operators in the Jurong petrochemical hub in Singapore, Mak added.
Jurong is the world’s largest bunkering port and third largest oil hub, and is home to major storage operators like Vopak.
“There will be more Mideast and European names taking up space at our project. We have spoken to almost all independent storage operators in Jurong. Vopak (Pengerang) and Vitol Tank Terminal International (VTTI – Tanjung) have indicated their interest.
“After inking the deal with Abu Dhabi, I am sure that it will be the catalyst for the people whom we are talking to right now to speed up and do something. We are confident we can monetise
at least half of the landbank soon,”Mak said.
It was reported that Benalec was pricing its initial reclaimable tracts off Tanjung Piai at more than RM3 million per acre, compared with RM10 million at the Jurong hub, which was also built on reclaimed land.
Vopak and VITI are already operating in Johor while Vopak, in partnership with Dialog Group Bhd, is constructing storage tanks at the Refinery and Petrochemical Integrated Development in Pengerang, Johor.
