NGV Is The Better Alternative To Petrol

Rev up the new, out with the old

2009-11-02T09:04:00.000+08:00

TheStar Online (November 2, 2009)

The revised National Automotive Policy announced by the Government has brought some good news to the industry, but there are reservations, particularly by owners of older cars.

THERE’S much for the industry to decipher from the latest round of changes announced by the Government on the National Automotive Policy.

A few of the measures may be of interest to the man in the street.

One of them is the VEL or Vehicle End of Life policy. It is a norm in advanced countries to adopt such a policy.

Singapore has one for some time where older cars are sent for annual inspections to ensure they are roadworthy and do not pose a danger to other road users.

The idea has been mooted many times in Malaysia over the years but it never gained prominence until now – the argument being that there are 2.7 million vehicles which are 10 years or older on the road. Compared with other countries, Malaysia has a high average vehicle age and low scrap rate.

Vehicles which are 15 years old will most likely be subjected to an annual inspection although no implementation date has been announced.

If implemented it might not become popular as some people in a Felda plantation for example might no longer be able drive their 20-year-old boneshakers anymore unless they fork out the money for repairs.

Let’s hope Puspakom – or whichever agency responsible for vehicle inspections – has the capacity to deal with the sheer number of vehicles that are due for inspections. There should not be too much of a hassle to go through the process.

The introduction of the cleaner Euro 4M standard for petrol and diesel by 2011 should be some cause for cheer as Malaysia has been lagging behind in fuel standards.

Malaysia only moved from Euro 1 to Euro 2M in September this year and the sulphur content of diesel has been reduced from 5,000 parts per million (PPM) to 500ppm.

Euro 4M has not more than 50ppm of sulphur. Sulphur in a diesel engine produces sulphur oxides and particulates – both of which have been linked to health problems.

But every step up the cleaner fuel ladder brings with it additional refining processes and questions persist over how much more the new fuel will cost.

The good news is that Euro 4M will allow many of the new generation diesel cars, which have a low carbon footprint, to be sold in the country. More of these would augur well for the consumer as well as for the environment.

“Many European franchise holders were keen to import diesel cars that were able to run on Euro 4 standard a few years ago but held back because the Malaysian fuel quality was still at Euro 1,” a spokesman for a local car franchise said.

In Europe, where 50% of the passenger cars are diesel powered, almost every car maker including Mercedes-Benz, BMW, Volkswagen, Peugeot, Renault, Citroen and Fiat, have the new generation diesel engine options in their line up.

Consumers can expect fuel bills to go down with these diesel engines, which provide more power, torque and higher fuel economy compared with a similarly petrol engine.

Every budget brings the hope of cheaper cars but that is an unlikely scenario in the latest round as the tax structure for cars is largely intact.

In fact, those planning to buy a hybrid car might also want to do so before the end of next year.

That is when the exemption on import duty and 50% excise duty exemption for imported hybrid vehicles given in 2008 ends.

There is no mention of that date being extended under the revised NAP and the Government is offering a slew of incentives and exemptions to manufacturers to establish hybrid car and electric car assembly.

If and when there are takers, it’s going to take some time before you can dream of cheap hybrids.

Driving them crazy for not having card

2009-09-26T08:08:00.000+08:00

TheStar Online (September 26, 2009)

JOHOR BARU: Commuters of the Second Link in Tanjung Kupang are finding it a hassle since the toll plaza there no longer accepts cash payment.

Technician Ruzman Khairul, 44, a Singaporean, said he felt inconvenienced because the Touch ‘n Go or SmartTAG could only be bought in Malaysia.

“Touch ‘n Go cards should also be sold in Singapore so that we can be prepared before we come here,” he said.

Although the system would help ease traffic, he said, there should still be an option for people who pay with cash.

PLUS Expressways Bhd had earlier announced that all toll transactions at the Tanjung Kupang toll plaza would be conducted electronically starting Sept 14. No reason was provided.

Another Singaporean, Rohaidi Khamis, 30, said the new move was inconvenient to infrequent users. The school teacher said many commuters were unaware of the cashless system at the toll plaza.

Ivan Jensen, 52, felt that there should have been more publicity on the matter prior to its implementation.

The engineer from Denmark said commuters who did not use the Second Link regularly would be the most affected. “They probably would not know about the system until they reach the toll booth.”

Another businessman, known only as Tham, said motorists from Singapore would be endangering their lives as they would have to park their car by the roadside, then cross over to the other side of the busy route to purchase the card.

Gelang Patah MP Tan Ah Heng said PLUS should have sought feedback from the public before implementing such a system.

Toll charges should also be reviewed to make it more attractive for motorists, she said, adding that she would write to PLUS and the Public Works Department soon.

State Tourism, Domestic Trade and Consumer Affairs Committee chairman Hoo Seong Chang was surprised with the move.

“The Second Link is one of only two land entry points into the southern region,” he said.

Two new NGV stations for Klang Valley

2009-09-17T12:28:00.001+08:00

TheStar Online (September 17, 2009)

KUALA LUMPUR: The Government has approved sites for Petronas to build two new NGV stations to cater to the needs of residents in the Federal Territory and Klang Valley, Prime Minister Datuk Seri Najib Tun Razak said.

He said the sites, in Bandar Tun Razak and Jalan Cochrane, would be developed within the next six months.

“There are times motorists, especially taxi drivers, face problems filling up as the capacities of NGV stations are limited. The new stations should be able to solve this,” he told reporters at the Jalan Maarof Petronas station in Bangsar here yesterday.

Also present were Federal Territories Minister Datuk Raja Nong Chik Raja Zainal Abidin and Petronas president and chief executive officer Tan Sri Mohd Hassan Marican.

There are 125 NGV stations nationwide. — Bernama

Find out if your car is RON95 compatible

2009-09-09T09:18:00.002+08:00

Received this information from a friend.

Check out if your car is RON95 compatible here!

Price of RON 95 at RM1.80 from Tuesday

2009-08-31T20:34:00.001+08:00

The StarOnline (August 31, 2009)

KUALA LUMPUR: The newly introduced RON 95 fuel is now priced at RM1.80 - five sen higher than the previous RM1.75.

Meanwhile, RON 97 is upgraded as a premium product and has gone up to RM2.05 from RM1.80.

Domestic Trade, Cooperative and Consumerism Minister Datuk Seri Ismail Sabri Yaakob said the new prices were decided based on the current method of Automatic Pricing Mechanism (APM).

“Although the price is now 5 sen higher, the Government is still subsidising 33.81 sen per litre (of RON 95) which is equivalent to RM304mil monthly,” he told reporters after the launch of Primax 95 by Petronas here on Monday.

Currently, the Government is subsidising RON 97 by 42.72 sen per litre.

The cost for RON 95 went up 102% from USD$ 40.75 per barrel to USD$ 82.30 in December last year and August respectively.

“If there is any changes in the global prices, we would revise it accordingly. It is up to the Economic Council to decide.

“RON 95 also adheres to the EURO2M specification where it can lessen pollution,” said Ismail Sabri, adding that consumers would get quality petroleum at a subsidised price.

With the new pricing, Ismail Sabri added that RON 92 was phased out from the market as the usage was only 5% from total petrol sale in the country.

In April last year, then Domestic Trade and Consumer Affairs Minister Datuk Shahrir Samad said the Government was considering the use of petrol with higher research octane number (RON) to reduce fuel subsidies without hurting the lower-and-medium income groups.

A higher octane number means higher resistance to engine “knocking”. “Knocking” could possibly damage the engine over time.

Petrol Dealers Association of Malaysia president Datuk Hashim Othman said petrol stations could easily recalibrate their pumps to adjust to the new price.

“With technology, all you need to do is push some buttons. It is almost automatic in most stations now, except for a few in the rural areas which are still using the manual system,” he told The Star.

He added that petrol dealers would make a slight gain with the price increase as they had bought their current stock at the old price.

“It is only a little as the price increase is small,” he said.

Dynamic Diesel on sale from Sept 1

2009-08-21T21:46:00.000+08:00

SHAH ALAM: The Dynamic Diesel – Malaysia’s first diesel fuel to meet the Euro 2M emission standard – is priced at RM1.77 per litre and will be on sale on Sept 1.

A diesel meeting such a standard meant it is a better fuel, and the sulphur content in diesel reduced from 3,000 parts per million (ppm) to 500ppm.

Petronas Dagangan Berhad expected the diesel to be well-received by motorists.

“We are confident that it’s the best diesel available,” Petronas Dagangan senior general manager (retail business division) Mohd Fadzlan Abdul Samad told reporters after the new diesel launch at a Petronas station along the Federal Highway.

Dynamic Diesel, he added, was different from the previous diesel products offered by Petronas, as this new fuel was formulated with Sinar D07 additive – which not only cleaned but maintained the engine cleanliness.

“We changed the additive package from D05 to D07, which will result in better fuel economy and lower exhaust emission, hence, more environment-friendly,” he said.

Petronas Dagangan is targeting demand from owners of vehicles ranging from luxury cars to double-decker buses.

Latest update: Kidnap Girl Returns Home

2009-07-24T08:44:00.001+08:00

To all my readers and friends,

I would like to inform that my friend's niece has finally return home yesterday. It has been a great moment of joy and relief for her whole family during the reunion.

Thank you all for your help and support!

Here's a news report documenting her return home

NOTICE: Please beware of this young man
Here is a picture of the 20 year old boy who kidnapped my friend's niece from her home. He is using a fake name, 盧永斌 to cheat young girls. His real name is 方志偉.

Please help spread his photo around to warn other young girls and their parents about him!

My intention in posting this warning is to alert parents and their young daughters not to be so gullible and trust good looking and sweet talking boys, especially after knowing them for a short period of time.

Find out more about them, be on your guard and listen to your heart if it tells you that something might be wrong.

Family Looking For Kidnapped Girl from Klang

2009-07-17T12:56:00.004+08:00

To all my readers and friends.

Today I received some disturbing news from my friend that her niece has been kidnapped.

I would like to appeal to you to help my friend and her family find her niece, Lee Ru Yi, who was kidnapped from Klang on the 14th July 2009.

They received some information and believe that she has been brought to Penang.

If you can, please pass this message on to your friends and relatives.

If there's any news, pls contact my friend's brother, Mr. Lee @ 012-3189399 or Mrs. Lee 016-9797110.

Thanks a lot!

Travel direct between KL and Penang on NSE

2009-07-11T14:33:00.002+08:00

TheStar Online (July 11, 2009)

KUALA LUMPUR: Starting Monday, motorists using the North-South Expressway (NSE) between Kuala Lumpur and Penang and vice versa can travel direct without stopping at Ipoh Selatan and Ipoh Utara toll plazas to collect tickets or make payment.

They could travel non-stop between Ipoh Selatan and Jelapang, a distance of 14.7km, said a PLUS Expressway Bhd statement.

Motorists in Ipoh, Tambun, Jelapang, Lumut and the vicinity are advised to use the Ipoh Selatan and Ipoh Utara toll plazas to enter the NSE enroute to Kuala Lumpur and Penang. — Bernama

Government may reduce toll rates

2009-07-11T14:29:00.000+08:00

TheStar Online (July 11, 2009)

KUALA LUMPUR: The Government is mulling over a proposal to cut toll rates to ease growing public complaints about rising charges.

A source said the proposal also entailed discounts for heavy users of toll roads in cities and major towns.

This could be modelled along the loyalty programme currently being offered by Litrak, the Damansara-Puchong Highway (LDP) operator, which had a 20% rebate for road users paying RM200 or more a month.

The proposal suggested that discounts be offered to users who paid toll five or more times a day, regardless of the daily amount.

However, the source said it was uncertain if concessionaires would be asked to absorb the cost for the discounts or whether they would be compensated.

“The Government undertook a study following complaints of increasing toll charges and the initial finding is that it would be too costly to mount a Government takeover of the companies,” the source said in an interview yesterday.

Malaysia has 22 highway concessionaires, three of which are listed.

There have been public dissatisfaction over the scheduled increase in toll charges, stipulated in the concessionaries’ agreements.

The Government has since declassified the toll agreements for public viewing and had said it would revisit the agreements. — Reuters

Association drops bombshell over cars with natural gas

2009-07-11T14:24:00.001+08:00

TheStar Online (July 11, 2009)

PETALING JAYA: Thousands of cars using natural gas may just be “bombs-on-wheels” on the roads.

The warning comes from the Water and Energy Consumers Association of Malaysia (Wecam) whose research found that many motorists subscribed to this “penny wise, pound foolish” mentality by having their gas tanks installed by backyard workshops and unqualified mechanics.

Wecam secretary-general S. Piarapakaran said these motorists compromised on safety and settled for cheap materials and shoddy workmanship.

“They were found to have patronised backyard workshops and unauthorised mechanics for the installation of gas tanks in their vehicles.

“Since the gas is highly inflammable, poorly fixed gas tanks with leaking rubber hose could easily explode during a collision,” he said.

He said there was no competent body in the country to monitor natural gas vehicles (NGVs).

“Imagine the damage to the environment and loss of lives if the vehicles are plying busy highways,” he said yesterday.

Piarapakaran suggested that the police and Road Transport Department should get assistance from Sirim and other organisations to keep tabs on NGVs.

The association also said that there would be regular checks and enforcement of safety features in NGVs, use of genuine parts and reduction in the cost of installing tanks by authorised dealers. — Bernama

Driver killed in NGV blast

2009-07-05T09:12:00.004+08:00

TheStar Online (July 5, 2009)

SUBANG JAYA: An NGV-powered Proton Waja exploded in the car park at an apartment in Serdang Jaya yesterday, killing its driver and destroying three other vehicles.

K. Mailvaganan, 43, was found slumped in the front seat of the car at about 6.45am by police officers who were alerted to an explosion at Skyvilla Apartments.

It is learnt that Mailvaganan, a limousine driver, might have fallen asleep inside the car with the engine running.

A security guard at the apartment said he heard the loud explosion before seeing a cloud of black smoke from one of the CCTV images.

Selangor police chief Datuk Khalid Abu Bakar said that based on initial police investigations, there was no element of foul play.

Complete wrecks: Mailvaganan’s car (right) and two other cars that were destroyed after his NGV-powered vehicle exploded yesterday.

“Nevertheless, we are still waiting for the post mortem result from Serdang Hospital before determining the cause of death,” he said.

He urged anyone with information on the incident to contact the nearest police station to assist in investigations.

Oil prices near US$72, a new high for this year

2009-06-11T16:50:00.000+08:00

TheStar Online (June 11, 2009)

HOUSTON: Oil prices surged again Wednesday to a new high for the year with investors pouring money into crude markets as a hedge against inflation.

Adding to crude's advance was new government data that showed an uptick in U.S. demand for gasoline, yet given how much cheaper gas is compared to last year, the recession is clearly taking a toll on consumers and businesses.

Benchmark crude for July delivery rose $1.32 to settle at $71.33 a barrel in trading on the New York Mercantile Exchange after earlier touching $71.79.

It was the second time in as many days that crude hit new heights this year at the close.

As U.S. currency has lost value over the past several months, crude prices have doubled largely from the influx of cash from Wall Street.

Investors have used oil and other commodities as a hedge against a weak dollar.

The most recent government reports show that investors who are not buying and selling oil for commercial purposes, such as airlines who hedge energy costs, have entered the market and are betting crude oil is going to rise.

Equity markets have rebounded on the belief that the worst of the recession is over and that has helped pull energy prices higher, said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates.

"That kind of economic optimism easily feeds into expectations that oil demand will be coming back sooner than expected," Ritterbusch said.

Crude and gasoline held in U.S. storage facilities tumbled last week, the government reported Wednesday, as Americans took to the road for the summer driving season.

But the country is still flush with gasoline and oil, and it's the weak dollar that has driven crude prices higher for weeks.

The Energy Department's Energy Information Administration said Tuesday that crude prices will likely average $67 a barrel in the second half of 2009, about $16 higher than the first six months of the year.

A month ago, the EIA's price-per-barrel forecast for the second half of 2009 was $55.

The EIA also predicted consumers will be paying $2.70 for a gallon of gasoline by July before prices level off.

In other Nymex trading, gasoline rose by 4.86 cents to settle at $2.0153 a gallon while heating oil settled at $1.8326 a gallon - up 2.5 cents. Natural gas for July delivery fell 2.3 cents to $3.708 per 1,000 cubic feet.

In London, Brent prices rose in tandem with Nymex crude, gaining $1.11 cents to $70.73 a barrel on the ICE Futures exchange.

Trader and analyst Stephen Schork noted that "for the thirteenth time in the last 15 sessions, London crude for July delivery posted a new year-to-date high." - AP

Oil Is Plentiful, Demand Weak. Why Are Gas Prices Going Up?

2009-05-29T23:16:00.002+08:00

By VIVIENNE WALT / PARIS Vivienne Walt / Paris – Fri May 29, 7:05 am ET

Storage tankers across the globe may be brimming with oil that no one is buying because of the global economic downturn, but the traditional laws of supply and demand don't always apply to oil prices. Drivers have faced rising prices at the gas pump in recent months, as investors and oil-producing countries hoard supplies in anticipation of a global economic recovery later this year.

The 12 member countries of the OPEC cartel voted in Vienna on Thursday to maintain output at current levels rather than increase supplies in order to bring some relief to consumers, particularly in the gas-guzzling West. The OPEC oil ministers, whose countries account for about 40% of the world's entire crude-oil supply, also renewed their commitment to stick to their agreed quotas, rather than ship extra oil, as they began doing last April when several members ignored their agreed output limits. OPEC leaders, many of whose economies are heavily dependent on oil exports, have struggled to stabilize prices at a level that suits their own economic needs amid falling demand and rising supplies. Prices had rocketed to a record level of $147 a barrel last July before plummeting to $30 just five months later and beginning a new climb. (See pictures of South Africa's oil-from-coal refinery.)

Oil analysts believe OPEC's decisions on Thursday could help push oil prices even higher; oil futures on the New York Mercantile Exchange have risen 36% in just two months, to about $63.46 a barrel on Thursday. And that appears to be on track to achieve targets set by OPEC leaders. Saudi Oil Minister Ali al-Naimi - OPEC's key power player - said Wednesday that oil prices ought to rise to between $75 and $80 a barrel by the end of the year. "Demand is picking up, especially in Asia," he told reporters puffing alongside him as he jogged through the streets of Vienna. "The price rise is a function of optimism that better things are coming in the future."

The economic recovery Naimi so optimistically predicts would certainly be vital to oil-producing countries, whose own economies would be imperiled by a drawn-out recession. Oil demand in rich countries has crashed since the onset of the economic crisis last year, and is now at its lowest level since about 1981, according to the Paris-based International Energy Agency. U.S. oil inventories - the stored surplus - this month reached their highest level since the 1980s. And about 2.6 billion barrels are currently stored in commercial tankers around the world. "There is some risk we will run out of storage space in the next four to six weeks," says Simon Wardell, director of global oil at IHS Global Insight, an energy-forecasting company in London. To oil-rich countries that possibility evokes grim memories of 1998, when the Asian economic crisis sent demand plummeting, driving world oil prices down to $10 a barrel. "If we run out of storage it could prompt a collapse in the price," says Wardell. Oil producers might then choose to dramatically cut output in order to run down the surplus. (See pictures from Azerbaijan's oil boom.)

Despite such dangers, investors and oil producers are betting that global demand will roar back, apparently hoping that the recession has already hit bottom. Over the past two months, investors have plowed billions of dollars into oil futures. If the U.S. and other major industrial economies rebound, oil supplies could be depleted because the recession has prompted producer nations to freeze hundreds of projects to open new oil wells or upgrade existing ones. In the oil-rich Niger Delta, a major Nigerian government offensive against rebels has seriously disrupted production for several weeks. Venezuela's Oil Minister Rafael Ramirez said in Vienna that his country could not afford to invest in major new oil exploration unless prices rise further. "We need a level of at least $70 [a barrel] to recuperate investment," he said on Thursday. Muhammad-Ali Zainy, senior energy analyst at the Center for Global Energy Studies in London, says oil demand could increase quickly once the recession ends, especially as China has begun to build up its strategic oil reserves. "We think the price is going to go up gradually," says Zainy.
For those feeling the pain at the gas pumps, however, there is one piece of good news. Oil is unlikely to hit $147 a barrel again - at least not during the coming decades. The U.S. Energy Information Administration said on Wednesday that oil prices would likely rise to $110 a barrel by 2015 and $130 a barrel by 2030. By that time the world oil markets might once again follow the normal rules of economics.

Banks set to increase interest on borrowings for non-national car buyers

2009-04-20T16:09:00.001+08:00

TheStar Online (April 20, 2009)

PETALING JAYA: Despite the economic slowdown, several banks are believed to be raising interest rates on car loans.

And the move may be implemented today.

It is learnt that these hikes, probably on a tiered basis, are likely to affect non-national cars.

The current reasoning for the hike in loan rates for non-national cars is to make up for provisions set aside for losses and administrative costs.

This could indicate that non-performing loans in the auto segment could be creeping up.

Sources said talk was rife in the banking and auto industries late last week that under the tiered proposal, better rates could be quoted on shorter term loans for non-national cars.

The duration of the car loans could stretch to five, seven and nine years.

Currently, a flat rate of about 2.7% to 2.8% is charged on loans for non-national cars although the effective rate over the duration of the loan could be higher.

It is believed that for a five-year loan for a non-national car, the hike could be only a few basis points, expected to be in the region of 0.4% to 0.5%.

However, rates which are higher at around 3.75% for national cars could see a reduction as the tiered scheme is supposed to provide more attractive rates for shorter term loans.

Car loans were adjusted sometime in the middle of last year as a lot of the rates were below or slightly above the interest rate of around 3.6%.

However, many are asking why should car loans go up when the base lending rate to which housing loans are tied is on a downtrend.

Car loans, however, are fixed rate loans and not tied to the BLR.

Higher grade fuels to hit market by Sept 1

2009-03-21T23:54:00.001+08:00

TheStar Online (March 21, 2009)

JOHOR BARU: The RON 95 petrol and Euro 2M grade diesel will hit the market by Sept 1, the Domestic Trade And Consumer Affairs Ministry announced.

Its Minister Datuk Shahrir Samad said the prices for both upgraded fuels would be the same as the previous grades.

“Not all cars use RON 92 petrol. The change will give consumers better alternatives in quality at a lower price,” he told pressmen here on Saturday.

He added that the announcement to replace current grades of fuel was made last year.

“Most cars need only RON 95 and do not require higher-octane levels,” he said.

On the diesel upgrade to EURO 2M, he said the Government aimed to introduce a higher quality fuel for modern diesel engines.

“The new upgrade will result in cleaner emissions and a better environment,” he said, adding that the current diesel fuel was of the lowest grade due to its high sulphur content.

Toll hike postponed indefinitely (Updated)

2009-02-27T19:41:00.001+08:00

TheStar Online (February 27, 2009)

KUALA LUMPUR: The toll hike for five major highways that was set to take place on Sunday has been postponed indefinitely.

Works Minister Datuk Seri Mohd Zin Mohammed said the decision was made due to the negative public reaction and the current economic situation.

“When the announcement was made, there was negative public reaction. As a result, the Cabinet decided today (Friday) to postpone the toll hike indefinitely,” he told a press conference at the Works Ministry here on Friday.

The toll hike, had it taken place, would have increased toll rates on the North-South Expressway by 0.68sen per km; the Sprint Highway by between 30sen and 50sen; the Sungai Besi Highway (Besraya) by 10sen; the Ampang-Kuala Lmpur Elevated Highway (Akleh) by 50sen and the New Pantai Expressway (NPE) by 40sen.

The announcement met with strong opposition from consumer groups, lorry and bus associations as well as Members of Parliament from both sides of the House.

They said it was not a good time to increase toll rates considering the economic situation.

Prime Minister Datuk Seri Abdullah Ahmad Badawi, who is in Thailand for the Asean Defence Ministers meeting, had also asked for the decision to be reconsidered.

Mohd Zin said as a result of the toll hike cancellation, the Government would have to fork out an additional RM287mil to pay the concessionaires - PLUS (RM195mil), Sprint (RM36mil), Akleh (RM27mil), Besraya (RM9mil) and NPE (RM20mil) - for the period Jan 1 to Dec 31 this year.

Mohd Zin said RM245mil was already paid to PLUS, Akleh and Sprint in the form of compensation due to a scheduled increase in January last year that did not take place.

“The Finance Ministry will prepare the compensation as stipulated in the concession agreement.”

Mohd Zin said the money being used for compensation was also the public’s money that could have been used to implement other projects that could benefit the entire country.

On Thursday, Mohd Zin announced that road users would have to pay a higher toll when using the North-South Expressway (PLUS), the Sprint/Kerinchi/Damansara Link highways, Ampang-Kuala Lumpur Expressway (AKLEH), Sungai Besi Highway and the New Pantai Expressway (NPE).

For the PLUS highway, it was a 5% increase. This meant that toll charges from Bukit Kayu Hitam in Kedah to Kempas in Johor would increase from RM108 to RM113.40.

A trip from Kuala Lumpur to Ipoh would increase from RM26.50 to RM27.90.

For the Sprint/Kerinchi/Damansara Link highways, it was an increase of between 30sen and 50sen.

The Sungai Besi Highway was to see an increase of 10sen, while the AKLEH and NPE were to be increased by 50sen and 40sen respectively.

Mohd Zin had said the increase was minimal and hoped the public understood that the increase was stipulated in the concession agreements that the Government had signed.

Prime Minister Datuk Seri Abdullah Ahmad Badawi, however, urged for the decision to increase the toll rates to be reconsidered.

He said the matter will be discussed in the Cabinet meeting Friday, which will be chaired by Deputy Prime Minister Datuk Seri Najib Tun Razak.

“People are having difficulties. The situation is not right for a toll hike. I feel that this matter needs to be discussed again in the Cabinet.

”The decision may come in the form of measures that will included in the second stimulus package or through some other measures,” he had said in Pattaya, where he was attending the Asean Defence Minister’s Meeting.

New toll rates may be deferred following public outcry

2009-02-27T09:59:00.003+08:00

TheStar Online (February 27, 2009)

A toll increase announced yesterday by the Works Minister for five major highways may be put on hold following a public outcry and the Prime Minister also calling for a review.

Datuk Seri Mohd Zin Mohammed had earlier revealed that toll for PLUS’ North-South Expressway (NSE), Sprint Highway, Ampang-Kuala Lumpur Elevated Highway (Akleh), Sungai Besi Highway (Besraya) and the New Pantai Expressway (NPE) would be raised simultaneously from Sunday.

The increase for the NSE will be 5%, or 0.68sen per km. For the other highways, the increase ranges from 10 sen to 50 sen.

The increase will affect all classes of vehicles, the exception being buses on the Sungai Besi Highway.

Reacting to the announcement from Pattaya, Thailand, Datuk Seri Abdullah Ahmad Badawi called for a review of the decision, which he said was made two or three weeks ago.

He said the Cabinet would meet today to discuss other ways to compensate the toll concessionaires.

Under the new rates announced, the toll for the 734km NSE journey from Bukit Kayu Hitam (Kedah) in the north to Kempas (Johor) in the south will be adjusted to RM113.40, up from RM108, while a trip from Kuala Lumpur to Ipoh will be increased from RM26.50 to RM27.90.

Mohd Zin described the rates as minimal and hoped that the people would understand that the increases were stipulated in the concession agreements the Government had signed.

“The increase was actually due in January last year but we have postponed it until now. This means the Government has been paying compensation for 14 months,’’ he told a press conference at the Works Ministry yesterday.

Mohd Zin said the compensation amounted to RM277mil with RM177mil going to PLUS, RM38mil to Sprint and RM30mil to AKLEH.

Malaysian Highway Authority director-general Datuk Mohammed Razali Othman, who was present, said some of the concessionaires got full increases while some only half, as outlined in the concession agreements.

“Any shortfall will be compensated by the Government,” he said.

The announcement to increase the rates comes after the Salak Jaya toll (south-bound) was abolished on Tuesday and the toll at PJS2 (Kuala Lumpur-bound) of the New Pantai Expressway was done away with on Feb 13.

Mohd Zin said the toll increase should not be politicised, stressing that it was a contractual obligation on the Government’s part.

Time to take tolled roads private

2009-02-27T09:50:00.002+08:00

TheStar (February 27, 2009)

THE government finally bit the political bullet and announced yesterday it will allow a partial increase on five tolled roads. Toll rate increases were due in January last year which meant the government had been paying compensation for 14 months.

The toll increases shift part of this burden to motorists, but because the full contractual increase was not allowed, the government has to compensate the concessionaires for the balance.

This will be a recurring issue and burden for the government and the motorists who use these roads.

This is also an opportune time for the government to take these highways private, in the same way that many major shareholders have taken private their publicly-listed companies in the last one year.

Taking the highways private now would dissolve the debacle in a way that will satisfy all stakeholders – the government, motorists, bankers, bondholders and shareholders.

It is now timely to do so because share prices of the listed toll concessionaires are subdued, and financing costs for the government are much lower than before.

Market values of the listed concessionaires – PLUS Expressways Bhd and Lingkaran Trans Kota Holdings Bhd (Litrak) – offer internal rates of return (IRR) in the low teens, an acceptable cashflow rate of return for an investor.

Costs of financing are also low as institutional cash is flowing into government bonds everywhere in the world.

The government could issue bonds at an interest cost of just 3% to 4% a year. Institutions would subscribe to them.

The Employees’ Provident Fund (EPF) would also be keen to finance a government purchase of tolled highways. For many years in fact, the EPF has not been able to obtain sufficient government bonds to invest in.

An issue of bonds to the EPF at a rate of say, 6%, would be adequate and well below the IRR of the concessionaires.

Recent references of the nationalisation of tolled highways are not politically correct.

Nationalisation connotes expropriation of private sector assets by a government for little or even no payment.

For the government to take the listed tolled concessionaires private would be no different from major shareholders taking their listed companies private.

The government can make an offer at current market prices with a small premium.

That leaves the matter, of course, of whether shareholders will accept the offer.

Government-linked companies and EPF own more than 70% of PLUS, which greatly raises the rate of success in a takeover manoeuvre.

A proposal from Teh Chi-Chang, an economic adviser to the DAP and previously Citigroup’s head of research for Malaysia, suggests that within six years, cashflow from toll collections by PLUS would be adequate to repay all government bonds issued in a takeover.

Hence, the PLUS highways could be toll-free by 2016, instead of another 20 years or so till the end of the concession period. Various options and financial implications of taking the tolled highways private are worth a detailed study by the government.

PM: Reconsider toll hike (Updated)

2009-02-26T21:57:00.002+08:00

TheStar Online ( February 26, 2009)

Prime Minister Datuk Seri Abdullah Ahmad Badawi wants the decision to increase toll rates on five highways, which was announced earlier Thursday morning, to be reconsidered.

He said the matter will be discussed in the Cabinet meeting Friday, which will be chaired by Deputy Prime Minister Datuk Seri Najib Tun Razak.

The Prime Minister is here to attend the Asean Defence Minister’s Meeting. On Friday, he will attend the Asean Summit in Hua Hin Friday.

Abdullah said the decision to increase the toll rates on March 1, which was announced by Works Minister Datuk Seri Mohd Zin Mohammed, was made three weeks ago.

”However, the situation has now changed, and the economy has not become better as yet, which was why we recently decided to introduce the second stimulus package or the mini-budget.

”People are having difficulties. The situation is not right for a toll hike.

”I felt that this matter needed to be discussed again in the Cabinet.

”The decision may come in the form of measures that will included in the second stimulus package or through some other measures.

”I think that’s the best we can do - do a review and decide on whatever that is appropriate,” he told reporters.

Abdullah said the people should understand that the toll increase was connected to the highway concession agreements made between the Government and the concessionaires, in which major roads were be constructed by private initiatives through toll collections.

Asked whether the imposition of the new toll rates would be postponed, Abdullah said the people cannot accept the increase now.

”The new rates were to begin on March 1. It has not been implemented yet.

”So, there’s still time, and the Cabinet will have to make another report on the matter.

”The technical issues will be handled by the Finance Minister,” he added.

Works Minister announces toll hike
KUALA LUMPUR: Road users will have to pay higher tolls for five major highways beginning March 1.

The highways affected are the North-South Expressway (PLUS), Sprint/Kerinchi/Damansara Link highways, Ampang-Kuala Lumpur Expressway (AKLEH), Sungai Besi Highway and the New Pantai Expressway (NPE).

For the PLUS highway, it will be an increase of 5%.

This means toll charges from Bukit Kayu Hitam in Kedah to Kempas in Johor would increase from RM108 to RM113.40.

A trip from Kuala Lumpur to Ipoh would increase from RM26.50 to RM27.90.

For the Sprint/Kerinchi/Damansara Link highways, it will be an increase of between 30sen and 50sen.

The Sungai Besi Highway will see an increase of 10sen, while the AKLEH and NPE will be increased by 50sen and 40sen respectively.

In announcing this, Works Minister Datuk Seri Mohd Zin Mohammed said the increase was minimal and hoped the public understood that the increase was stipulated in the concession agreements that the government had signed.

“The increase was actually due in January last year but we had postponed it until now. This means the government has been paying compensation for 14 months.”

Mohd Zin said the compensation amounted to RM277mil with RM177mil going to PLUS, RM38mil to Sprint and RM30mil to AKLEH, adding that the impending increase was half of what was scheduled.

“There is a shortfall of 5%,” he said during a press conference at the Works Ministry on Wednesday.

The announcement for the increase however comes almost immediately after two toll booths were abolished recently.

The Salak Jaya toll (south-bound) was abolished on Tuesday while the toll at PJS2 (Kuala Lumpur-bound) of the New Pantai Expressway was abolished on Feb 13.

Mohd Zin said the abolishments were unrelated to the toll increase and that it should not be politicised, stressing that it was a contractual obligation on the government’s part.

He said more importantly was that alternative routes existed for all highways in the country, adding that this was the case for all highways but added that more could be done to improve the alternative routes.

When pointed out that the roads were jammed especially in the city regardless of whether it was a highway or an alternative route, Mohd Zin said it was a big challenge having to manage the amount of traffic Kuala Lumpur has.

“Kuala Lumpur has 3.5 million vehicles for a population of about five million people.

"Tokyo only has 1.3 million vehicles for a populationf 20 million,” Mohd Zin said, concluding that more effort was needed to improve public transport.

Toll increase from March 1 for five highways

2009-02-26T21:53:00.005+08:00

TheStar Online (February 26, 2009)

Road users will have to pay higher tolls for five major highways beginning March 1.