Port Klang Free Zone Sdn Bhd (PKFZ Sdn Bhd) said it paid RM25 psf for 1,000 acres of land on Pulau Indah because it was the level of transacted prices for adjacent land.

The company acquired the land from Kuala Dimensi Sdn Bhd at the prevailing market price because it could not obtain it through the Acquisition of Land Act 1960.

Under the Act, land acquisitions can only be made for public purposes. The land, which was issued with a development order, had economic value so could not be acquired under the Act, said Lim Thean Shiang, executive chairman of PKFZ Sdn Bhd.

Clarifying media reports published last month, Lim said PKFZ Sdn Bhd had agreed to the price of RM25 psf back in 1999, which brings it to a total of RM1.088 billion for the land with its development order and with infrastructure that is now completed.

The total cost of the PKFZ project is RM4.6 billion, which includes land, office complexes and other construction costs. The total sum is to be paid over a 15-year period, with payments made to bondholders that are mainly financial institutions.

According to Lim, PKFZ Sdn Bhd has so far paid RM1.38 billion to bondholders under the scheduled payment terms, leaving a balance of about RM3.22 billion to be paid under the schedule. The company funds this project via a long term soft loan at an interest rate of four per cent from the Ministry of Finance.