PUTRAJAYA: The government has terminated the Dredging and Reclamation Concession Agreement of a company, which was previously involved in dredging and reclamation works at ports nationwide.
Transport Minister Anthony Loke said the ministry issued a default notice dated Jan 29 to
Integrated Marine Works (IMW) Sdn Bhd with a three-month remedy period until April 29. The company, however, failed to remedy the breach of the agreement terms.
It later issued a termination notice to IMW on Tuesday (June 11).
Loke said among the breaches of agreement terms were that IMW changed shareholders without government approval and failed to pay concession charges.
"When the Dredging and Reclamation Concession Agreement was signed, IMW was wholly-owned by Inai Kiara Sdn Bhd. However, around July 2023, the ministry was informed that Inai Kiara had been wound up by a Winding Up Order from the Shah Alam High Court dated April 11, 2023.
"Further investigations by the ministry found that the shareholders of IMW had been changed from Inai Kiara to Inai Warisan without government approval.
"This means that IMW breached a term of the agreement, which stipulates that the company cannot change shareholders without government approval.
"Additionally, IMW was found to have failed to make the concession charge payment for 2023 as stipulated in the Concession Agreement," he told a press conference.
IMW was granted a 15-year extension of its concession to provide dredging and reclamation works at all federal ports owned by the government in May 2022.
Federal ports owned by the government include Port Klang, which is made up of Northport and Westports in Selangor; Port of Tanjung Pelepas and Johor Port in Johor; Penang Port; Teluk Ewa Port in Langkawi; Tanjung Bruas Port in Melaka; Kemaman Port in Terengganu; Kuantan Port in Pahang; and Labuan Port.
The new concession agreement was signed after the conclusion of the previous 15-year concession granted to IMW that began in 2004.
Loke added that as a result of the termination with IMW, the ministry will not appoint a new concession company.
Instead, he said, a new policy will be formulated to encourage the growth of the dredging and reclamation industry among more competitive local companies for the development of the country's ports.
"It should be emphasised that most dredging and reclamation projects at federal ports are funded by the respective port operators," he added.