Westports began work on CT8 in January and will complete the new terminal in mid-2017 with a projected total investment of MYR1bn. The expansion project will increase Westports' handling capacity to 13.5m teu from 11m teu currently.
Westports ceo Ruben Emir Gnanalingam was reported as saying that the capex for this year would be funded via internally-generated funds and that the company had no plans to raise any debt this year.
“We have no plans to raise any debt this year, probably next year we will do it to fund the CT8 development,” he said.I
n addition, Westports has close to MYR1bn left from its MYR2bn sukuk programme that was available for issuance.He also revealed that Westports is still waiting for the Malaysian government’s decision on the container handling tariff hike at Port Klang, where Westports operates its main terminals.
Local media cited a CIMB Research report as saying that while Westports had asked for a hike of 50%, it believed that a tariff hike of 30% is highly possible.
Ruben said the tariff hike was “something that needs to happen” because the last revision was made 12 years ago.
“We would remain competitive with any tariff hike because our current rate is the lowest in the region.“Without which it is not sustainable for the long term because our cost would continue to increase,” he said. However, the timing for the tariff hike approval was uncertain.Ruben forecasted a 5% to 10% increase in container growth this year from 8.4m teu last year.
“We are expecting to handle more than nine million TEUs this year,” he said.He noted that the growth for this year would be supported by the Ocean Three Alliance (O3), bringing could bring an additional 500,000 teu to the port a year, as well as from Asean countries.
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