Oral Reply by Senior Minister of State for Transport Mrs Josephine Teo to Parliamentary Question on Impact of Construction of Malacca's Kuala Linggi International Port

Mr Saktiandi Supaat asked the Minister for Transport

a.     what will be the impact of the construction of Malacca's Kuala Linggi International Port on our status as a regional shipping hub;

b.     how will this impact our economy; and

c.     how can our port services be kept competitive.

Reply by Senior Minister of State Mrs Josephine Teo:

1.     Madam Speaker, the expansion of Malacca's Kuala Linggi International Port (or KLIP) will reportedly add oil storage and bunkering facilities. 

2.     The expansion is expected to be completed only within the next decade, so it is still too early to determine the exact impact on Singapore's economy. 

3.     Our preliminary assessment, however, is that KLIP's planned oil storage capacity of 1.5 million cubic metres is not big relative to Singapore's current capacity of 20.5 million cubic metres.  In addition, our position as a regional bunkering and oil storage hub is anchored by a strong ecosystem of oil refineries and oil traders, and by the high volume of ships calling at Singapore for various services.  

4.     As for the container handling business, KLIP's expansion does not appear to include any such facilities. The expansion should therefore have minimal impact on Singapore's container transhipment business. 

5.     Overall, Singapore's attractiveness as a port of call extends beyond the provision of any one service, whether bunkering or oil storage, and stems from our ability to offer efficient end-to-end services to shipping companies. 

6.     Having said that, Mr Saktiandi is right that we must not be complacent. Indeed, we are always looking at ways to ensure that our port remains competitive.   

7.     First, we have been and will continue to invest in technology at the port to better meet the needs of the shipping industry. For example, the new berths at Pasir Panjang Terminal Phases 3 and 4 feature a fully-automated yard crane system, which raises port productivity.  In time, PSA will integrate this with an automated guided vehicle system, which is currently under trial, to move the containers around the port.  Singapore is also the first port in the world to require bunker to be delivered via a mass flow metering system.  This not only enhances operational efficiency, but also strengthens the integrity of our bunkering services. 

8.     Second, we listen assiduously to feedback from the shipping companies. MPA regularly surveys shipping companies on how they view supporting port services in Singapore, such as towage and pilotage services, compared to those at other ports. This enables MPA to systematically identify and address any shortcomings, and keep standards high. 

9.     Third, we have been investing significantly in manpower.  MPA actively partners the industry and institutes of higher learning to grow the pool of skilled maritime professionals.  These efforts include the enhancement of training programmes such as the Certificate of Competency programmes to develop local seafarers. Recently, we also introduced the SkillsFuture Earn and Learn programme for port operations officers. 

10.    Finally, we are developing a next-generation port at Tuas.  With an annual capacity of up to 65 million TEUs, the Tuas terminal is expected to be the largest container terminal in the world, allowing us to achieve greater economies of scale and to more efficiently handle the mega ships of the future.  The port will also incorporate new automation and technologies to further boost efficiency and productivity. 

11.    Madam Speaker, Singapore's position as a leading and competitive hub port is due in large part to our efforts to aggressively and continually improve port productivity and service levels, and to build up a comprehensive port and maritime ecosystem. We will closely monitor KLIP and other regional developments for their potential impact on Singapore, and take further measures as necessary to retain our competitive edge.