Penang Undersea Tunnel: Shocking appeal by MBPP on behalf of developer

Dato’ Eric See-To

The RM209mil payment to the Penang Undersea Tunnel Special Purpose Vehicle (SPV) company was for the grossly overpriced consultancy studies for the 3 roads consist of two plots of state land.

The first payment was a plot of seaside state land valued at RM135mil and was transferred to the SPV on 17th February 2015.

The SPV then went into a joint-venture with a listed company to develop this land on a 60-40 basis with the SPV holding a 40% interest. The Joint venture (JV) is for the development of a luxury condominium project comprising of two blocks of 40 storey buildings totaling 572 condo units where each unit is priced at RM1,200psf and above.

The condo project is now facing some delays as more than a 100 residents in the area had complained that the MBPP is wrong in approving such a high density project in that residential area.

The residents had managed to get a stay order from the Penang State Appeals Board who had ruled in their favour.

However, in a shock move the MBPP then appealed on behalf of the developers against their own Penang State Appeals board. The MBPP lost the appeal in April 2016 and had to pay costs to the appeals board and the residents.

It was an embarrassing situation where the state government viathe MBPP had appealed on behalf of a developer against the state government’s own appeal board and lost. Hence the state government had to pay the state government for costs.


Is it the normal practice of the Penang State Government to appeal on behalf of a developer against its own State Appeals Board or was this a one-off event – hence indicating special treatment for the Tunnel SPV?

Why is the DAP Penang State Govt so protective of the Tunnel SPV company?

Is this DAP govt, the govt for the people or for the developers?

Source: Eric See-To.



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