GEORGE TOWN, Sept 14 — A large tract of hilly land in Paya Terubong will be developed at a cost of RM40 million to be another tourist attraction for Penang, Chief Minister Chow Kon Yeow announced today.

He said the signing of a 45-year lease agreement between the Penang Development Corporation (PDC) and KAT Resources Sdn Bhd today will allow for a more systematic and planned development of the land that will benefit both the state and the tourism industry.

The development under KAT Sdn Bhd will include a durian orchard, livestock feeding area, viewing areas, campsites and recreational activities such as flying fox, hiking and glamping.

Chow said some 40 hectares of the 165-hectare land had been previously used for illegal vegetable farming.

He added that the deal is to develop the land in a safe and systematic manner, and that the state might involve the farmers who could be given leases for smaller plots to legalise their activities.

He said the state is also working to provide jobs for those who had trespassed and built 10 houses on the state land by involving them in the new agrotourism project.

"This project will take the farms into account and see if it can be integrated with this project,” he said.

"These few years, the state has undertaken challenging projects and since then, some have taken off including the cable car, LRT, the Bukit Kukus paired road project and now this project,” he said in a press conference after witnessing the signing of the agreement between PDC and KAT at his office here.

He said the state will continue to push for projects that will benefit and stimulate the state economy and overcome any challenges in the implementation of these projects.

KAT Resources Sdn Bhd chief executive officer Teoh Kok Aun said they will be allocating RM20 million for the next five years for agriculture and infrastructure works on the site.

"We will allocate another RM20 million for tourism development,” he said.

He said the project will start after they obtain the necessary approvals from the local authorities.

"We expect to start in a year and it will take about five years to plant the agriculture component while the construction of tourism infrastructure will be built after that,” he said.

He said the project is expected to create 400 jobs in the agricultural and tourism sectors.

"It is also expected to bring in revenue of RM3 million a year from agriculture and RM5 million a year from tourism,” he said.

He said there will also be spillover effects in the nearby hospitality and food and beverage sectors.