Construction Sector - Jalan Sultan MRT POA: Two-thirds have signed OVERWEIGHT

- Through a media release from its website, MRT Co announced that nine landowners in Jalan Sultan have signed 10 Points of Agreement (PoA) as at 7 May 2012.

- With the signing, this takes the number of property owners in Jalan Sultan that have signed the PoAs to 16 out of a total of 24.

- MRT Co added that a further two property owners have agreed for their properties to be acquired, while another four property lots are currently at the advanced stages of negotiations.

- The owners in Jalan Sultan, Jalan Inai and Bukit Bintang along KL City Centre have been in the spotlight in recent months. This was due to protracted negotiations with MRT Co on their affected properties, which are located along pockets of major tunnelling works being carried out by MRT Co for the Klang Valley MRT project.

- From our channel checks, Jalan Sultan will be the location of the Pasar Seni Station, one of the seven underground stations along the 51km route of the Sg Buloh-Kajang (SBK) MRT Line.

- The tunnelling portion of the 51km-long SBK line measures around ~9.5km-long. It runs from Semantan north portal until Maluri south portal.

- This stretch starts near the intersection between Jalan Semantan and Jalan Duta, before snaking through KL Sentral, Pasar Seni, Bukit Bintang, Stadium Merdeka, and Pasar Rakyat, before reemerging near Taman Miharja.

- The latest development marks another step forward for the roll-out of the SBK MRT project, particularly with regard to land acquisition issues for its tunnelling works along the KL city centre.

- Just last month, the MMC-Gamuda JV was formally awarded the tunnelling contract worth ~RM8.3bil. The JV had also recently indicated that it would acquire six tunnel boring machines (TBMs) costing ~RM360mil in total from Germany-based Herrenknecht. We gather that up to 10 TBMs are required for the SBK line.

- The first two TBMs would arrive by early next year  ahead of the scheduled commencement of construction works by March 2013 along the Pudu to Pasar Rakyat stretches. The construction of the station boxes is scheduled to start this month.

- Further out, we expect a step-up in contract newsflow on the MRT front where up to five elevated packages could be dished out within the next one to two months.  

Source: AmeSecurities