This article first appeared in The Edge Malaysia Weekly on August 31, 2026 - September 6, 2026
THE Penang state government will auction a six-acre parcel of land on Gurney Drive in George Town to raise more than RM300 million to help complete the long-delayed bypass road project linking Air Itam with the Tun Dr Lim Chong Eu Expressway.
The land, known as Plot 7A in Tanjung Pinang Town in the northeast district, is located on Jalan Peter Paul Dason, which connects Gurney Drive with Andaman Island.
According to the state government gazette, the site will be offered at public auction at 11am on Oct 7 at Komtar. The reserve price has been set at RM1,200 psf, while vacant land in the surrounding area is currently fetching more than RM1,000 psf on the open market.
Sources tell The Edge that the sale could generate more than RM300 million, with the proceeds intended to help the project’s concessionaire Consortium Zenith Construction Sdn Bhd (CZC) complete the bypass.
The RM851 million bypass project, also known as Package Two of Penang’s undersea tunnel and paired roads project, stretches about 6km. It is intended to connect Lebuhraya Thean Teik in Farlim with the Tun Dr Lim Chong Eu Expressway through a combination of elevated viaducts, tunnels and ground-level roads.
Construction began in February 2021 after years of planning and approvals, and was initially expected to be completed in 2025.
The project is being undertaken by CZC under Penang Infrastructure Corp (PIC).
For years, the promised five-minute commute between Air Itam and the coastal expressway remained just that — a promise.
The bypass project has moved at a crawl, and Penangites are starting to suspect that the delays are not just technical.
In May, Penang Chief Minister Chow Kon Yeow denied that the project has been dragging since 2012.
He said the contract was awarded only in 2020, before physical works started in 2021.
Asked whether the concessionaire had run into financial difficulties due to the Covid-19 pandemic, he said the pandemic was long over.
“Covid-19 has already passed. We cannot continue using the same excuse,” he said.
Chow confirmed that the concessionaire faced financial issues that slowed progress on the project.
He stressed, however, that work was still ongoing and the completion deadline remained April next year.
The project received its first extension of time (EOT) in 2023 after land acquisition processes affected key stretches of the alignment, which extended the deadline to Oct 31 this year.
A second EOT was approved in the middle of last year, extending the completion date to April 12 next year.
Penang state executive councillor and Paya Terubong assemblyman Wong Hon Wai said in a recent Facebook post that the project had reached 91% completion and remains on track to be completed next year.
He said the contractor had assured him the project would be completed according to schedule on April 12, 2027.
He said, however, progress at the other end remained far from satisfactory and added that intervention from the state government was needed at this juncture.
In 2013, CZC was selected through an open tender to construct an undersea tunnel and three main bypass roads on the island.
The consortium, formed a year earlier, is a joint venture between Beijing Urban Construction Group — known for its work on venues for the 2008 Beijing Olympics — and local firm Zenith Construction Sdn Bhd. Instead of funding the project through tolls, the state government granted CZC exclusive development rights over roughly 45ha at Gurney Bay in a deal that effectively swapped infrastructure for property development.
Federal environmental approval for the three bypass roads came in 2017. Two years later, the Penang government signed an agreement for the second package of works, followed by a groundbreaking ceremony in November that year. Actual construction did not begin until 2021, with completion now targeted for 2026.
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