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Asdion to kick off Tumpat Supply Base project in Q4

TheEdge Mon, Aug 26, 2019 05:38pm - 1 month ago


KOTA BHARU (Aug 26): ACE Market-listed logistics company, Asdion Bhd’s joint-venture (JV) partner to develop and manage the Tumpat Supply Base (TSB) project in Kelantan, Kingdom Infra Holdings Sdn Bhd (KIHSB), has received the relevant land titles from the state government, setting the stage for the project’s imminent construction and commencement.

Asdion executive director Razmi Alias said the title was for the 12.1-hectare seaside site in northern Kelantan, ideally situated to service the JV’s five-year Offtake Agreement involving the export of manganese ore to buyers in China, a critical element used in steel production for its automotive industry and also in the production of electric vehicles.

The land in Tumpat, with an estimated market value of RM26 million, is situated a mere 20 km from Kota Bharu, the last stop in the East Coast Rail Link, and is poised to yield future opportunities for TSB in the coming years.

“With the imminent issuance of the project Development Order and a routine Traffic Impact Assessment to take place, we fully expect work on the project to commence by the fourth quarter (Q4), if not earlier,” Razmi said in a press statement today.

He said the TSB would benefit from the Offtake Agreement the JV signed to export minerals from Kelantan to China, which would generate RM151 million in revenue over the five-year period.

“Under a profit guarantee Kingdom Infra signed with Asdion, the mineral exports will yield a profit of RM12 million next year, contributing positively to Asdion’s earnings for its financial year ending Sept 30, 2020,” he said.

Razmi also said under the terms of the JV, Asdion will construct and complete facilities including a maintenance, repair and operation terminal for vessels, container yard, warehouses, stockpile area, customs complex and jetty for dry bulk handling, and access road and jetty, which will offer stable and diversified source of port-related revenue streams upon completion,” he added.

Demand for Malaysia’s metal and mineral production has largely been filled by China, which has been rapidly industrialising its cities and economy.

Malaysia is among the world’s top producers of bauxite and the biggest supplier to China, accounting for nearly half its supply, with shipments peaking at nearly 3.5 million tonnes a month at end-2015.

According to data from China Customs, as of 2017, copper ore, manganese ore, bauxite, chrome ore and zinc ore were the five metals/minerals most in-demand by China, each commanding import values in excess US$2 billion (US$1=RM4.20) annually.

The TSB’s strategic location at the northernmost tip of Kelantan puts it on the doorstep of Indochina and Greater China, offering vast opportunities to service the underserved eastern corridor of Thailand, Cambodia, Vietnam and Hong Kong, and across to Guangzhou in China, for the export of metals and minerals. — Bernama
 








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