KUALA LUMPUR, April 19 — Federal Territories Minister Khalid Abdul Samad today clarified that the National Physical Planning Council (NPPC) has not approved the proposed Penang South Reclamation (PSR) project to create three islands off the southern coast of the main island.

He said NPPC had only advised the Penang state government to look into 18 conditions in accordance with Section 2A(2)(b) of the Town and Country Planning Act 1976.

"The council did not give any approval or make any decision on the project; instead, it gave the state government 18 conditions which have been outlined,” he said in a statement this morning.

Yesterday Penang Chief Minister Chow Kon Yew had said the NPPC had given the green light for the PSR project.

He announced this after attending the council meeting yesterday.

He said the council, chaired by Prime Minister Tun Dr Mahathir Mohamad, approved the project with 18 conditions.

Khalid said the NPPC’s feedback included reviews from the Energy, Green Technology and Water; Rural Development; Agriculture and Agro-based; Transport; Housing and Local Government;  and Economic Affairs ministries.

"The state government was also advised to continue engaging with the local community and ensure their needs are given due consideration,” he said.

Khalid added that the proposal yesterday was only the master plan and the state government must re-submit the plan in accordance with Section 2A(2)(b) of the Town and Country Planning Act 1976.

The PSR is a reclamation project that plans to create islands covering 4,500 acres off the southern coast of the Penang island.

It is expected to increase the state’s land bank. Lots on the islands will be sold to raise money to fund the state’s ambitious RM46 billion Penang Transport Master Plan (PTMP).

Gamuda Bhd deputy group managing director Rashdan Yusof had revealed in February that PSR will create islands A, B and C off the coast.

Island A will be zoned as a new industrial park due to its proximity to the airport, while Island B will be specifically for high-end support services for the industrial park, such as financial services, business services and tourism.

Finally, Island C will be for the creation of new tourism products for Penang.

Gamuda Berhad is part of SRS Consortium, the project delivery partner for the PTMP.

SRS Consortium will be reclaiming the sea off the coast for the PSR project.

PSR is the funding module of the RM46 billion PTMP which will include a Light Rail Transit (LRT) and the building of Pan Island Link 1 (PIL1).