MAHB to ask for better operating agreement terms

KUALA LUMPUR: Malaysia Airports Holdings Bhd ( MAHB) is negotiating with the government to review the current operating agreement (OA) for better terms which will allow it to recoup any capital expenditure (capex) used for the development of airports under its management.

Acting group chief executive officer Raja Azmi Raja Nazuddin said the review would be made in conjunction with the Malaysian Aviation Commission’s proposal to move towards a Regulated Asset Base ( RAB) framework which would enable the company to be more effective in enhancing airport facilities nationwide.

He said under the current OA, the government was responsible to undertake all capital expenditure while the company acted as an operator and in return, it would receive revenue for running the airports.

“However, there is a mechanism in which airport tax is capped using a certain formula, that being the passenger service charge formula.

“The user fee paid (to the government) in return for the operating rights increases by 0.25 per cent a year,” said Raja Azmi yesterday.

He said under the RAB framework, MAHB could potentially undertake some of the huge capex needed to upgrade or improve the airports under its management, and move towards the role of a developer instead of an operator. — Bernama