KUALA LUMPUR (Oct 20): Gamuda Bhd (KL:GAMUDA) has signed an agreement with the Perak government to develop and operate the Northern Perak Water Supply Scheme, which will transfer up to 1,500 million litres per day (MLD) of raw water from Sungai Perak to Bukit Merah Dam.
In a filing with Bursa Malaysia, Gamuda said the agreement, signed on Tuesday (Oct 20), involves Khazanah Air Perak Sdn Bhd (KAP), a 50:50 joint venture between Gamuda and Perbadanan Kemajuan Negeri Perak, and KAP’s wholly-owned subsidiary, Prasarana Air dan Irigasi Perak Sdn Bhd (PAIPP).
The NPWSS will be developed in two phases to transfer up to 1,500 MLD of raw water from Sungai Perak to Bukit Merah Dam. Of this, 500 MLD will meet northern Perak’s irrigation needs, while the remaining 1,000 MLD will serve domestic and industrial demand, including the second phase of the Kerian Integrated Green Industrial Park (KIGIP), with surplus water available for sale to Penang.
Under the agreement, KAP will build and maintain the raw water infrastructure, while PAIPP will develop and operate a water treatment plant with an initial capacity of 500 MLD, subject to regulatory approvals.
PAIPP had signed a 40-year bulk water supply agreement with Penang water operator Perbadanan Bekalan Air Pulau Pinang Sdn Bhd on July 15, 2026, providing for an initial supply of 300 MLD.
Gamuda expects the project to contribute positively to group revenue and earnings from the financial year ending July 31, 2027. The Phase 1 water treatment plant has a six-year development period from the date PAIPP obtains lawful access to the site, followed by a 40-year operating period from its commercial operation date.
However, implementation of the raw water infrastructure remains conditional on funding and execution arrangements between the state and federal governments, while the project is also subject to regulatory approvals and other construction-related risks.
The agreement does not disclose the project’s total value, Gamuda’s investment commitment or the expected revenue and earnings contribution.
On project risks, including construction and regulatory risks, Gamuda said it would draw on its infrastructure expertise and track record, with support from the state government, to mitigate potential challenges.
The group cited its experience in delivering large-scale water infrastructure projects, including Phases 1 and 3 of the Sungai Selangor Water Supply Scheme and Phase 1 of the Ulu Padas Water Supply Scheme in Sabah.
Shares of Gamuda closed 10 sen, or 2.06%, lower at RM4.75 on Tuesday, giving the group a market capitalisation of RM28.79 billion.