KUALA LUMPUR (Nov 10): Benalec Holdings Bhd has suspended the trading of its shares on Thursday, ahead of a likely announcement of a major land reclamation project in Johor.
In a statement to Bursa Malaysia asking for the suspension, the company said it intends to release an announcement on a material contract on Thursday.
Sources said Benalec is likely to announce a land reclamation project to create a large oil and gas (O&G) hub in the Pengerang area, on the southern tip of Johor.
Pengerang is home to Dialog Group Bhd's project to develop a deepwater petroleum terminal and tankage facilities. Dialog's terminal involves tankage facilities for handling, storing, blending and distribution of crude oil and petroleum products, together with marine facilities capable of handling large crude carriers with a water depth of up to 26 metres.
Benalec's project, it is believed, will likely involve reclaiming land to house a major industrial park for companies and facilities serving the O&G industry there. The park is expected to cater for businesses spanning the entire value chain of the oil and gas industry, including oil terminals, steel and shipyards.
Benalec, whose niche is in marine construction and reclamation, is likely to undertake the job and will develop part or all of the land.
The project will be one of the biggest reclamation jobs for Benalec outside its traditional base of Melaka, where it has reclaimed over 2,000 acres, mostly for mixed development use.
The company undertook its first reclamation job in Langkawi, Kedah, in 2000, followed by one in Port Klang in 2003, but has since focused mostly on Melaka.
A week ago, Benalec announced to Bursa Malaysia that its wholly-owned units Pengerang Maritime Industries Sdn Bhd and Tanjung Piai Maritime Industries Sdn Bhd had acquired stakes of 70% in Spektrum Kukuh Sdn Bhd and Spektrum Budi Sdn Bhd for RM7,000 each.
While the amounts involved are small, it is interesting to note that Benalec's partner in these ventures is the crown prince of Johor — Tunku Ismail Idris Tunku Ibrahim.
Tunku Ismail and Daing A Malek Daing A Rahaman are directors of Spektrum Kukuh and Spektrum Budi and they hold the remaining stakes of 21% and 9% respectively in the two companies.
Both companies were incorporated in April 2011 and listed their principal activities as property investment holding. Besides Tunku Ismail and Daing A Malek , other directors are Leaw Seng Hai, Datuk Leaw Tua Choon and Leaw Ah Chye, according to Benalec's announcement to Bursa Malaysia.
Prior to this, Benalec announced on Oct 31 that it had sealed a RM36.60 million contract to reclaim 60 acres of land on the coast of Pulau Konet, Alor Gajah, Melaka. Benalec said its unit Benalec Sdn Bhd had sealed an agreement with Anzeco Coal Terminal Bhd, a unit of Anzeco Corp (M) Sdn Bhd, to undertake the reclamation.
"The contract sum for the reclamation works to be executed by Benalec shall be at RM36.60 million only, which shall include all costs, expenses and payments," it said.
To recap, on Feb 1, 2010, the Melaka government signed a reclamation agreement with Anzeco Corp in which the latter was given the right to reclaim that portion of the coast of Pulau Konet measuring 60 acres.
Benalec said the reclamation will start within four weeks from the date of the agreement or upon Anzeco obtaining all necessary approvals, whichever is later. The reclamation is expected to be completed within 18 months.
Among the projects Benalec delivered previously were the turnkey design-and-build of the jetty, helipad and associated works at Pulau Perak, Kedah; construction of a marina at Puteri Harbour, Nusajaya, Johor; and land reclamation and soil improvement for Glenmarie Cove, Port Klang.
Besides marine construction, the company is also involved in the vessel chartering and marine transport businesses.
It currently owns around 93 vessels, which are mainly used to support its marine construction activities. The vessels are also deployed for chartering services for third-party clients such as dredging and reclamation contractors, and for the oil and gas, offshore construction, general cargo, and bulk cargo industries.
For the financial year ended June 2011, Benalec posted a net profit of RM96.08 million on the back of RM214.49 million in revenue.
The stock closed five sen higher at RM1.43 with 15.29 million shares traded on Wednesday.