GEORGE TOWN: Penang has urged Transport Minister Datuk Seri Dr Wee Ka Siong to clear the air on the status of the Penang International Airport (PIA) expansion and proposed Kulim International Airport (KXP) projects.

State Infrastructure and Transport Committee chairman Zairil Khir Johari said besides the PIA expansion, the progress of the KXP project that is spearheaded by the Kedah state government had raised many questions among travellers and industrial players alike.

"I would like to begin by congratulating (Datuk Seri Dr) Wee on his reappointment as the Transport Minister. As there has been no major changes for this portfolio, it is hoped that the minister and his team can focus their attention on these urgent concerns.

"Is the KXP project sanctioned and approved by the federal government when they have clearly said all airport projects would be put on hold pending the National Airport Strategic Plan (NASP) study? 

"And if it is not, will the federal government allow the project to continue? If it does continue, what impact will it have on the expansion of the PIA, which is Malaysia Airports Holdings Bhd (MAHB)'s 'golden goose' in terms of both passenger arrivals and cargo?

"Clarification is needed and the Penang government hopes the Transport Minister can clear the air on both the PIA expansion and KXP projects.

In July last year, the Transport Ministry, in a parliamentary written reply to Bayan Baru parliamentarian Sim Tze Tzin at the Dewan Rakyat, had said that any proposal for new airport development, including for the expansion and upgrading of the PIA, would only be considered after the NASP study had been finalised.

The ministry had said that the study on the development of airports and short take-off landing airports (STOLports) in the country was expected to be completed in 2023 in line with the National Transport Policy.

It had also said that the tourism and aviation sectors were among the worst affected by the Covid-19 pandemic, which led to market uncertainties that heightened the risks weighing on the aviation industry.

On Aug 2, the Kedah state government signed a joint venture agreement with ECK Group to build the KXP.

It was reported that with the signing of an agreement between the ECK Group and KXP Airportcity Sdn Bhd (state owned company), KXP might be built by 2026.

The first phase of the airport construction, by 2026, would cost RM6 billion including the cost of land acquisition.

A special purpose vehicle would be formed with ECK Group holding 80 per cent and the balance to be held by KXP Airportcity Sdn Bhd.

Elaborating, Zairil said with vaccination rates increasing and economic sectors gradually opening up, it would not be long before the PIA achieved its previous levels of passenger numbers.

"Therefore, will it not be prudent to begin construction of the PIA expansion now when the airport is virtually empty in preparation for the future?" he asked.

In 2013, the PIA was upgraded to cater to a capacity of 6.5 million passengers per annum (PPA). However, passenger growth exploded and by 2019, its capacity had been far exceeded with a total 8.3 million PPA recorded.

Hence, during the Pakatan Harapan administration, the Transport Ministry had approved the proposal to expand the airport to a minimum of 12 million PPA.

Planning permission was submitted to the local authorities and work had been scheduled to begin when the Covid-19 pandemic hit.

Unfortunately, the pandemic also coincided with the change of federal government in early 2020, resulting in the airport expansion project being put on hold.

In justifying the decision, the federal government had announced that all airport expansion plans nationwide would be postponed pending the finalisation of the NASP study.

"As the PIA is one of MAHB's fastest growing and most profitable airports in pre-Covid-19 times, it is safe to assume that passenger growth will pick up again the moment the pandemic is brought under control and borders are reopened," Zairil added.