JOHOR BARU: Exclusive water provider in Johor, SAJ Holdings Sdn Bhd, is planning to obtain an allocation of RM900 million in capital expenditure (Capex) from Pengurusan Aset Air Bhd (PAAB) for its fourth operating period (OP4) which would commence in January 2018.
Chief Executive Officer Abdul Wahab Abdul Hamid said the amount was about the same as the capex allocation approved for the current operating period (OP3) which started January 1, 2015 until December 2017.
Under the rule set by the National Water Service Commission (SPAN), all water operators have to submit their business plan a year in advance of its next operating period.
SAJ is the midst of preparing the plan now, he said.
The asset project would be implemented by PAAB, under the purview of the Ministry of Finance, and would be handed over to the water operator, on lease, when it is completed, he said.
"We will continue to look into the needs and improve the infrastructure when needed to ensure the water supply meets the demand of the population.
"Basically, the capex allocation will be spent for new treatment plants, new pipeline, replacement of old pipeline and meters," he told reporters on a media familiarisation trip to SAJ organised by Ranhill Holdings Bhd, on Tuesday.
Ranhill owns 80 per cent of SAJ Holdings.
He said the new treatment plants would usually use the biggest chunk of the capex while the pipeline expenditure would cost around RM60 million a year.
Abdul Wahab said as for OP3, which would end in 2017, SAJ had already implemented projects worth about RM200 million while the balance would be carried into the next operating period.
"To put new assets in place usually would take time as it has to go through various designing stage, as well as, challenges like land acquisition.
"However, this would not cause water supply disruption as SAJ still has spare capacity in average of 15 per cent, " he said.
In Johor, he said SAJ produced an average of 1,730 million litres per day of water (MLD) from its 44 water treatment plants throughout the state.
The plants have a current capacity of about 1,900 MLD.
Abdul Wahab said the development plan for water capacity in the state would be in line with the population growth which is about three per cent per annum.
The water, sourced from catchment areas, rivers and dams are processed and treated before it is distributed to 638 reservoirs.
It is then channeled to 1.10 million customers in Johor through pipelines spaning 22,000 kilometres in length.
SAJ was previously allocated RM580 million in the first operating period which started from July 1, 2012 to June 30, 2012, another RM290 million in the second period (from July 1, 2012 to Dec 31, 2014) and RM900 million in the third period (Jan 1, 2015 to Dec 31, 2017). --BERNAMA