The Penang government has given the green light to low-profile businessman Datuk Jeyakumar Varathan to build and commission a monorail test track on a 30-acre site in Batu Kawan, sources say.

It is believed the test track, said to cost about RM70 million, could be a sign that the state is embarking on its own monorail plans. Sources say the groundbreaking work for the project could be as early as December.

When contacted, Jeyakumar confirmed the plan but declined to elaborate. Penang Chief Minister Lim Guan Eng and Penang Development Corporation declined to comment.

Sources say discussions between the Penang government and Jeyakumar were initiated a month ago and talks have been fruitful. It is believed that Jeyakumar initiated the proposal.

To fund the venture, a consortium that includes Middle Eastern and Chinese investors will be formed, according to the sources. The consortium will rope in a Japanese company as a technology partner.

The consortium will stand a chance of constructing a monorail network in Penang but it will first have to prove that its technology can work by setting up the test track, complete with a monorail car and systems.

“If the monorail project in Penang takes off, the new company will have to tender for it just like everyone else,” says a source.
It is believed that Jeyakumar’s priorities are building the test track, and eventually a factory that will supply to South Africa and other parts of the world.

Details of the proposal, especially with regard to the financing and technology for building the monorail car, signalling and systems, have not been finalised.

What is certain is that the latest development has caught the attention of industry players.

This is especially after the federal government shelved the Penang monorail project during the mid-term review of the Ninth Malaysia Plan. The letter of intent for the RM1.6 billion project was given to a consortium led by Malaysian Resources Corp Bhd.

Members of the consortium include Scomi Engineering Bhd and the Penang Port Commission. Other contenders for the monorail project were the Melewar Industrial Group Bhd and its partner Putera Capital Bhd, as well as MMC-Metrail Sdn Bhd.

Along with the monorail project, the Penang Outer Ring Road (PORR) project was also put on hold. However, the federal government recently endorsed the revival of the RM1.02 billion PORR project.

The revived PORR project that is being promoted by a private company, Peninsular Daya Aliran Inovasi Sdn Bhd, is now before the state for approval.

As for the monorail project, there has been no development so far, until new of the proposed test track in Batu Kawan.
If the test track materialises, it will  be the third such facility after MMC-Metrail’s plant in Nilai, Negri Sembilan, and Scomi Rail’s facility in Rawang, Selangor, on a 22-acre site.

A global technology player for monorail systems is Japan-based Hitachi.

Meanwhile, the 24km Second Penang Bridge will connect Batu Kawan on the mainland to Batu Maung on the island. It is slated for completion in 2011.

Jeyakumar hogged the limelight in the monorail business in 2007 when his consortium — a Malaysian investment group called Newcyc Consortium — won the bid to build a US$1.7 billion (RM5.7 billion) elevated monorail line linking Johannesburg and Soweto in Gauteng province, South Africa. Jeyakumar has also been reported to be involved in trying to get monorail jobs in India and Sri Lanka.

Jeyakumar's consortium for the South African job comprised a group of Malaysian property developers, electronics companies and others. Jeyakumar was then CEO of the consortium.

Construction of the 44.7km Gauteng line was slated to begin in September 2007 and be completed in 2009. However, it never took off.

According to a Bloomberg report in 2007, former South African Transport Minister Jeff Radebe (now South Africa's Minister of Justice and Constitutional Development) said the proposal disregarded the national rail plans.

It will be interesting to see how Jeyakumar pulls off his ambitious plans, this time on home ground.




This article appeared in The Edge Malaysia, Issue 777, Oct 19-25, 2009.