KUALA LUMPUR: Berjaya Corporation Bhd (BCorp) has entered into a 25-year concession framework agreement with China’s Xinan Public Asset Investment Co Ltd (XPAI) for the proposed construction of two wastewater treatment plants in Xinan County, Guangdong Province.

In a filing with Bursa Malaysia Securities yesterday, BCorp said the plants, an 11km-long piping works and supporting facilities, and infrastructural works carried an estimated cost of about RMB200 million (RM97 million) that would be implemented in phases.

It said the project would generate a total revenue of about RMB1.07 billion during the concession period.

BCorp said an additional 23km of piping would be constructed at a later stage, subject to further negotiations with XPAI, an investment company of the Xinan County government principally responsible for the development, implementation and supervision of all government construction projects in the county.

BCorp said it would be granted the rights to build, operate and maintain the projects for a 25-year period, inclusive of the construction, and thereafter transfer them to XPAI at no cost.

BCorp will be responsible for the cost and funding requirements, and XPAI would guarantee a specified minimum wastewater volume to be delivered to the wastewater treatment plants during the concession period.

BCorp said it foresaw positive long-term prospects in China despite the current global economic slowdown. “Projects in the infrastructure and environmental sectors throughout China are currently experiencing positive growth as a result of the anti-inflationary stimulus plans from the central and provincial Chinese government,” it added.

BCorp had earlier been awarded a landfill concession in Sanshui.

Bcorp said the proposed projects would be funded from internal funds and/or borrowings, the actual composition of which would be determined only at a later stage.

Of the two proposed plants, the Jinben industrial wastewater plant will have an eventual capacity of 40 million litres per day (MLD) and a 31km-long pipeline network.

BCorp said the detailed design was ongoing and the construction of the plant and an 8km-long piping work were expected to start in 2011 for completion within a year.

The Jiangnan new district sewage treatment plant will have an eventual capacity of 40 MLD and 3km of pipes. Construction of the plant is expected to start in 2012 and is also scheduled to be completed within a year.

BCorp yesterday closed two sen higher at its intra-day high of RM1.21 after falling to a low of RM1.15, with 9.85 million shares traded.

This article appeared in The Edge Financial Daily, July 7, 2010.