KUALA LUMPUR (Dec 14): Penang Barisan Nasional (BN) said the state government should ask the developer, Eastern & Oriental Bhd (E&O), which will soon create a man-made island off Gurney Drive, to waive its rights under the confidentiality clauses of the land reclamation agreement.

Its chairman Teng Chang Yeow said this today after Chief Minister Lim Guan Eng said old land reclamation agreements inked during the previous BN government contained confidentiality clauses.

"It came as no surprise the chief minister made an about-turn in declassifying all land reclamation agreements. It will be a surprise if he agrees to do it," he said in a statement.

Teng, a one-term state executive councillor in the BN state government until the government changed in 2008, said the state and developer should not "choose to hide behind the confidentiality clauses".

He said the state could always request the company to waive its rights under such a clause, as what Putrajaya had done in 2007 when the then prime minister Tun Abdullah Ahmad Badawi's administration wanted to declassify the highways agreements.

Putrajaya had instructed all the concessionnaires to waive their rights under the confidentiality clause, he said.

"All the concessionaires were obliged by the federal government’s request in the interest of the public. Malaysians then had an opportunity to vet all those agreements.

"If the federal government could do it, the DAP-led administration would not want to be left behind in doing so. If the truth must be told, then E&O should just agree to do it without even waiting for the state government to instruct it," said Teng, who is also Penang Gerakan chief.

The Penang government is planning to declassify all land reclamation agreements signed by the present and former state governments, after civil group Penang Forum said the state should reveal the details to back up Lim's argument that the state would have to pay a RM1 billion compensation if it suspended any approved land reclamation projects.

But Lim told the media yesterday that the state legal adviss had found confidentiality clauses in the contracts inked during BN's time, and was trying to find a way around it.

He said at best, the state would only declassify the agreements signed by the current state government, where only 60 acres had been approved for reclamation in Bayan Mutiara and Bayan Bay.

Among the projects approved during BN's reign was the Seri Tanjung Pinang (STP) development by E&O.

The concession agreement for STP dated Oct 4, 1990, provides for the reclamation of 980 acres at Tanjung Tokong off the northeast coast of Penang island, which would be reclaimed in two phases – 240 acres in the first phase and 740 acres in the second phase.

In 1999, E&O was required to surrender 20 acres of the 240 acres reclaimed in STP1, to the Penang government for the Proposed Coastal Road Corridor. In return, 20 acres would be replaced in STP2, bringing the total reclamation of STP2 from 740 acres, as provided by the Concession Agreement, to 760 acres.

Out of the 760 acres, a portion is to be surrendered to the state government, and from that, 110 acres will be given to Zenith BUCG Consortium Sdn Bhd as payment-in-kind for undertaking the RM6.3 billion project to build an undersea tunnel linking the island and the mainland and three highways on the island.

The environmental impact assessment for STP2 was approved last year, and the reclamation to build the 760-acre man-made island off the shoreline of Gurney Drive, is expected to begin soon.