Tuesday 30 May 2023
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KUALA LUMPUR (May 3): The Ministry of Transport (MOT) has received a detailed business plan from Malaysia Airport Holdings Bhd (MAHB) for the redevelopment of Sultan Abdul Aziz Shah Airport (LTSAAS) in Subang — also known as Subang Airport — following the federal government’s approval of the Subang Airport Regeneration Plan (SARP).

Transport Minister Anthony Loke Siew Fook said Putrajaya is in the midst of preparing a paper for Cabinet's consideration and that the paper is expected to be completed by the second quarter of this year.

Parliament will reconvene from May 22 to June 15.

“They (MAHB) have submitted it (business plan) to the ministry. The ministry is now preparing the Cabinet paper and will table it to the Cabinet within the next few weeks,” Loke said at a media briefing on Wednesday (May 3).

“It is according to our schedule. I had given a timeline to MAHB to come back to us by the end of March. The next step is of course that the ministry has to go through the proposal. We have circulated to other ministries as well, for comments. Once we receive comments, I will table it to the Cabinet,” he added.

Loke, however, declined to comment on the entire cost of the project.

On Feb 6, Loke’s ministry agreed to the regeneration of Subang Airport, which proposes its transformation into an aerospace hub within the city centre.

Loke said that the regeneration would focus on the development of the aerospace ecosystem, general aviation/business aviation and city airport.

Under the proposed plan prepared by MAHB, belly cargo flights with narrow-body jets up to the size of A320/B737 or their equivalent will be accommodated at Subang Airport.

Capital A Bhd, the parent company of low-cost carrier AirAsia Aviation Group Ltd, has applied for a licence to operate regional flights from the Subang Airport, its chief executive officer Tan Sri Tony Fernandes said on Feb 8.

In 2002, AirAsia, together with Malaysia Airlines, was ordered to shift their operations from Subang Airport to KLIA in Sepang, to boost the connectivity and growth of the Kuala Lumpur International Airport (KLIA) — the country’s premier airport.

Operating Agreement (OA) with MAHB to be signed soon

Loke said two Operating Agreements (OAs) with MAHB, which were to be signed by March this year, are being finalised and are expected to be signed soon despite some delays.

The first OA is for the operation, management, maintenance and development of KLIA and klia2.

The second agreement is for 37 airports and airfields (short take-off and landing airports (Stolports)) in the country. The OA will run until 2069.

Loke said with the OAs, MAHB is expected to have greater flexibility in the method of funding airport development costs, using either government allocations via funds channelled through development expenditure (DE), or MAHB’s own funds, through an identified investment recovery model mechanism.

The new material terms under the OA 2023 will enable the government and MAHB to implement a more competitive commercial development plan that has the potential to enhance the government’s income through revenue-sharing derived from government-owned land that is developed by MAHB.

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