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WATER TREATMENT, SUPPLY AND DISTRIBUTION

One of Taliworks’ core businesses is in the water supply sector. Currently, the business entails (i) an operation and maintenance (“O&M”) contract for the Sungai Selangor Phase 1 Water Treatment Plant (“SSP1”) that supplies treated potable water to large parts of Selangor and Kuala Lumpur, and (ii) the water treatment, supply and distribution system for the entire island of Pulau Langkawi, Kedah.

Both Sungai Harmoni and Taliworks Langkawi manage a total of 6 water treatment plants with a combined design operating capacity of 1,037 million litres per day (Sungai Harmoni: 950 million litres per day; Taliworks Langkawi: 87.3 million litres per day).

Sungai Harmoni Sdn. Bhd.

Sungai Harmoni is the O&M operator of SSP1. As part of the water restructuring exercise undertaken by the State Government of Selangor to consolidate the water industry in the state, Sungai Harmoni entered into the Bulk Water Supply Agreement in 2019 with Pengurusan Air Selangor Sdn. Bhd. (“Air Selangor”) in which its SSP1’s O&M contract was extended for an additional 7 years to December 2036. As a condition to operate SSP1, Sungai Harmoni was awarded an Individual License pursuant to Section 9 of the Water Services Industry Act 2006 from the Minister of Water, Land and Natural Resources.

Taliworks (Langkawi) Sdn. Bhd.

The water treatment, supply and distribution system in Pulau Langkawi, on the other hand, is managed by Taliworks Langkawi under a 25- year concession, which expires in October 2020. Taliworks Langkawi has been granted an authorisation under Section 192(5) of the Water Services Industry Act 2006 by the National Water Services Commission to undertake and carry out O&M activities under the Langkawi Water Supply Privatisation Agreement dated 7 October 1995 and the Supplemental Agreements dated 4 August 1999, 22 July 2001 and 1 August 2004. The undertaking of the O&M activities was effective from 1 February 2013 to 31 October 2020.