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TheStar Sat, Apr 13, 2019 10:40am - 5 years View Original

Ship-to-ship clean-up

THE move by the federal government to introduce a new ship-to-ship (STS) transfer hub in the waters of Johor has many positives, although execution will be key. To recap, the plan is to build what is being touted as the world’s largest STS hub off Johor’s Port of Tanjung Pelepas. The project also entails the entry of Hutchison Ports as a 30% shareholder of the proposed STS hub. This indicates a certain level of professionalism that should come into that area of business, where a lot of opaqueness exists currently. For example, it is difficult to know for sure how many actual operators of STS are presently running in the Johor Straits. It is also unclear who all the owners are (although some are clear) and what kind of revenues and profits they earn. What is impressive about the new STS hub is its grand plan. In a nutshell, it will have mooring structures to berth vessels without the need for piers or docks and at a lower cost for shippers. It will be able to accommodate up to 30 vessels at one time.

The hub, expected to be ready in 2021, will also be able to store nine million tonnes of petroleum products. None of the existing STS operators can come close to this. It will be in a position to win business from Singapore’s Tuas mega port. It is only logical for the new hub to eventually replace the scattered list of current STS operators there. The government of Malaysia is likely to gain from increased taxes and fees. But execution will be key. Indications are that the project will be privately funded. It should also be revealed that existing STS operator, KA Petra Sdn Bhd, was chosen as the party to lead this project and that more needs to be revealed about its credentials as the major owner of the new STS hub.



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