A new twist to Selangor’s water impasse


(The Malaysian Insider) – A new fight involving the ownership of water assets is brewing between opposition-led Selangor and the Barisan Nasional-controlled Federal government, sources say.

A source familiar with the matter says the feud centres on the ownership of assets such as the Semenyih and Bukit Nanas dams as well as a large network of pipes spanning thousands of kilometres, which Pakatan Rakyat says came under its control when the opposition coalition won the state in the 2008 general election.

This notion, however, is being disputed by the Federal government, which says these assets come under the control of Putrajaya.

“By (this week), the legal wrangling will begin. I know the state has already hired lawyers to look into the dispute,” the source adds.

Ownership of the dams could be a moot point. Checks by The Edge reveal that the Selangor state’s unit, Konsortium Abass Sdn Bhd, has a 30-year concession in the privatisation of the Sungai Semenyih Water Supply Scheme.

Meanwhile, Puncak Niaga Holdings Bhd (Puncak Niaga), which wholly owns water treatment company Puncak Niaga (M) Sdn Bhd (PNSB), controls the Bukit Nanas water treatment plant.

Some parties familiar with the water business say dams, like rivers, are the source of water and thus are state assets. Pipes are also said to be owned by the state. Nevertheless, it is likely that the federal government will have equally strong arguments for its case.

Considering how fragile the talks have been over the years, this dispute could derail the consolidation exercise.

“The Selangor government was supposed to conclude its negotiations with Puncak Niaga by the first week of February, but the federal government, through the ministry (Ministry of Energy, Green Technology and Water), has informed the state that it needs an additional one-month extension to conclude the deal as there is some dispute in terms of ownership of the assets,” the source explains.

More delays?

It is not clear how the legal wrangling over these assets would adversely impact the consolidation of the water sector in Selangor.

If the dams, treatment plants, pipes and other assets in dispute are under the four concession holders, there could be a further delay in the exercise.

To recap, the four concession holders are Syarikat Bekalan Air Selangor Sdn Bhd (Syabas), which has the mandate to distribute treated water to Kuala Lumpur, Selangor and federal capital Putrajaya, PNSB, Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH) and Konsortium Abass.

Both Syabas and PNSB are controlled by Puncak Niaga. SPLASH is 40% controlled by construction giant Gamuda Bhd, with the remainder 60% equally divided between Tan Sri Wan Azmi Wan Hamzah and the Selangor state via its vehicle Kumpulan Perangsang Selangor Bhd. Konsortium Abass is wholly owned by Selangor.