- The Edge Financial Daily reported today four companies have been shortlisted for the 1,000-tonne per pay (tpd) water-to-energy incinerator project in Taman Beringin, Kepong.

- The four companies bested 29 other bidders which were said to be in the initial shortlist, and were said to have formed JVs with international partners from Japan and South Korea. They are MRCB, Puncak Niaga Holdings, UEM and DRB-Hicom.

- UEM’s unit, UEM Environment is teaming up with Japan’s Mitsubishi Heavy Industries Ltd. Puncak is joining forces with Japan’s Hitachi Zosen Corp, and DRB-Hicom with Malakoff Corp (51%-owned by MMC Corp) and Japan’s Sumitomo Corp. MRCB is collaborating with South Korea’s Hyundai Rotem Co.

- We understand that the proposed incinerator in Kepong could have a concession period of up to 30 years. It could be undertaken on a Private Financing Initiative (PFI) basis.

- The proposed site for the incinerator in Taman Beringin is at the present site that houses a waste transfer station that currently handles a total of 2,400 tonnes of waste daily, above its existing capacity of 1,700 tonnes.

- The Edge Financial Daily report added that the Urban Wellbeing, Housing and Local Government Ministry is understood to have mooted a 50% local quota for the project.

- Back in July, the ministry’s Ministery Datuk Abdul Rahman Dahlan had reportedly said that the incinerator will be awarded next June, pending a detailed EIA that is currently being undertaken by University Teknologi Malaysia.

- Upon its expected completion in 2018, the daily further reported that the tipping fee – levied on the waste sent to Taman Beringin – will likely be set at between RM80 to RM90 per tonne.

- We understand that the project is required to deal with escalating solid waste generation in the Klang Valley, as the sanitary landfill at Bukit Tagar is reaching its capacity.

- We believe all four parties shortlisted have a fair chance of clinching this project given their associations with reputable foreign partners. All said, we believe it is still in the early days until the outcome of the EIA study.

Source: AmeSecurities