Penang: Bank Rakyat is providing RM167 million in financing for the Sungai Kerian Water Treatment Plant (WTP) project in Seberang Perai Selatan, covering 80 percent of its construction cost. Entrepreneur and Cooperatives Development Minister Steven Sim stated that this financing underscores Bank Rakyat's commitment not only to supporting micro, small, and medium enterprises but also to advancing critical infrastructure development that benefits both people and the economy.
According to BERNAMA News Agency, the RM209 million project involves building a water treatment facility with an 80 million liters per day (MLD) capacity under a 30-year Build-Operate-Transfer (BOT) model. Bank Rakyat serves as the sole financial institution backing the initiative with a 15-year financing term. The bank is also offering a two-year grace period to further support infrastructure projects in the region.
Penang Chief Minister Chow Kon Yeow, who officiated the project's ground-breaking ceremony, indicated that the plant is expected to supply an additional 80 million liters of treated water daily to approximately 223,000 consumers in Seberang Perai Selatan and Seberang Perai Tengah starting mid-2027. The Sungai Kerian WTP marks Penang's first water supply project employing the BOT model, with Inya Water Engineering (M) Sdn Bhd responsible for construction, operation, and maintenance for 30 years before transferring ownership to the Penang Water Supply Corporation (PBAPP).
The PBAPP Board chairman noted that while the project uses conventional water treatment technology, the BOT model's adoption represents a significant innovation in the state's water supply infrastructure development. PBAPP will purchase the treated water from the plant at an initial rate of RM0.98 per cubic meter starting in 2027, with price reviews every five years as per the agreement. The 80 MLD capacity increase constitutes about 6.6 percent of PBAPP's total treated water production from last year, and PBAPP will incorporate the cost of this water into its operating expenses for two years.
Furthermore, Chow assured that the operation of the Sungai Kerian WTP would not impact Penang's water tariff rates in 2027 and 2028.