Here are the details of the water solution agreement between the Selangor state government and the federal government, as best as the Spanker understands it:
The Memorandum of Understanding (MoU) was signed by Menteri Besar Tan Sri Abdul Khalid Ibrahim on Feb 26 with Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili, witnessed by Prime Minister Datuk Seri Najib Razak and Deputy Prime Minister Tan Sri Muhyiddin Yassin.
In essence, Selangor through state investment arm Kumpulan Darul Ehsan Berhad (KDEB) pays RM9.65 billion to buy over four water concessionaires - Syarikat Bekalan Air Selangor (M) Sdn Bhd (Syabas) which handles distribution and treatment companies Syarikat Pengeluar Air Selangor Sdn Bhd (SPLASH), Puncak Niaga (M) Sdn Bhd (PNSB) and Konsortium ABASS Sdn Bhd (ABASS).
The federal government will also inject RM2 billion to facilitate KDEB’s takeover of these companies.
In return, the state government will issue a development order for the construction of the Langat 2 Water Treatment Plant (Langat 2) and its distribution system (LRAL2) (Package 2A).
It also undertakes a RM900 million mitigation project funded by Putrajaya and commences a Horas (Hybrid Off River Augmentation System) in Sungai Selangor which will provide between 600 to 700 million litres of clean water a day or 3 billion litres by 2050.
Selangor also undertakes to reduce the non-revenue water percentage from the present 33% within six months.
While the Federal Government appears to have drawn the shorter end of the stick, the LRA2 that draws water from Pahang will see Putrajaya getting vast tracks of land for the purpose of developing the infrastructure for the said project.
This includes forest reserves that will be allocated for the purpose of LRA2. The Federal Government will also have equity ownership of all water companies purchased by KDEB.
It is no secret that Tan Sri Abdul Khalid’s sudden agreement after road-blocking the Federal Government’s attempts to restructure water assets in Selangor had taken PKR de-facto leader Datuk Seri Anwar Ibrahim by surprise as no one had expected him to sign the deal.