Pekat Group Berhad has entered into a conditional agreement to lease approximately 470 acres of land in Sungai Petani, Kedah, for renewable energy development, including solar photovoltaic (PV) systems and battery energy storage systems (BESS).
In a filing with Bursa Malaysia today, the company said its wholly-owned subsidiary, Pekat Teknologi Sdn Bhd (PTSB), signed the agreement with an undisclosed Malaysian company for a proposed 24-year lease of land located in Mukim Sungai Petani, Kuala Muda.
The aggregate rental payable over the 24-year lease term is estimated at RM54.5 million, based on the proposed acreage and scheduled rental increases.
The land will be used exclusively for renewable energy activities, including the generation, production and sale of renewable electricity, as well as the development, construction, installation, operation and maintenance of solar PV panels, battery storage systems and related infrastructure.
Under the agreement, PTSB will pay a monthly rental of RM350 per acre upon commencement of the lease, translating into an initial rental commitment of approximately RM164,500 per month, or RM1.97 million annually, based on the estimated land area.
The rental will increase by 3% every two years following the completion of the construction period.
Pekat said the proposed lease remains conditional upon PTSB securing the necessary regulatory approvals, permits and licences, including planning permission, to undertake its renewable energy activities on the land.
The subsidiary must also secure an acceptable electricity offtake agreement before the lease becomes unconditional.
Under the agreement, the parties have established a three-year exclusivity period commencing Sept 21, 2026, during which the landowner is prohibited from disposing of, leasing, charging or otherwise dealing with the land in a manner that could adversely affect PTSB’s rights.
The conditions must be fulfilled by the end of the exclusivity period, or such later date as mutually agreed by both parties. Failure to meet the conditions would entitle either party to terminate the agreement in accordance with its terms.
Subject to the fulfilment of these conditions, the lease will run for 24 years from its commencement date, with PTSB having the option to extend the arrangement for a further one to five years.
Pekat said PTSB will undertake the construction and associated development works over a 24-month period, followed by a stipulated operating period of 21 years, subject to the extension provisions under the agreement.
The landowner, whose identity was withheld due to confidentiality obligations, is a Malaysian private company principally involved in oil palm plantation and investment holding activities.
The proposed development will expand Pekat’s access to land for renewable energy projects as the group pursues opportunities in solar power generation and energy storage.
The announcement did not disclose the proposed solar generation capacity, battery storage capacity or total development cost of the project.
