SKTG 4493

Plant Design

Group 1

Assignment 1

NAME OF MEMBERS (Group 1):

1. Nur Hidayah Iqbal Fithri (A18KT0228)
2. Muhammad Aizat bin Darame (A18KT0146)
3. Mohamad Aiman Hakim Bin Mohd Roslan (A18KT0128)
4. Karnishani a/p R. Parameswaran (A18KT0360)
5. Abdullah Mohammed Abdullah Mubarak (A18KT4011)

LECTURER’S NAME: Prof Ir Ts Dr Sharifah Rafidah Wan Alwi

DATE OF SUBMISSION: 11 NOVEMBER 2021

 1. Find 2 different issues in the news regarding the protest of local communities due to certain
industrial site location. Compile the newspaper articles according to the issue raised and give
your team comment on the issues raised whether you agree or disagree. Example: Lynas
case, Sungai Kim-Kim case

The first issue is factories operating in Seri Juru Industrial Park, Penang. A newspaper article
written by Aundrey Dermawan states that relevant authorities have carried out investigation into
the factories that operating at the pollution site, Seri Juru Industrial Park. Sahabat Alam Malaysia
(SAM) president Meenakshi Raman have called the Seberang Prai City Council (MBSP), the
Department of Environment (DOE), the Department of Irrigation and Drainage (DID) and the
Seberang Prai Tengah District and Land Office to search for the irresponsible parties who releases
the toxic waste into the river by examine thoroughly the license to operate, the status of land
ownership, drainage system and whether the effluents discharged from the factories were treated.

SAM have also carried out some survey and observation on the industrial site and found out
that there are some heavy industry categories operate at the place. Not only that, there are also
factories that fail to display their signboard about the information of their operations. During the
survey, SAM authorities have found a pile of plastic waste at one of the premises probably for
recycling purposes. Meenakshi Raman said that the pile of plastic is near from aquaculture pond
operating adjacent to the industrial site. Besides that, the quality of water in the drains are also poor
as it looks black and emanating bad odour. The reasons of the poor water quality is because the
drain is contaminated with untreated sewage and other related pollutants releases by the nearby
factories. The SAM authorities also reported that there is significant mud deposit at the bank of the
river. The sources of the mud are still unknown but most probably ditches from the nearby
aquaculture activities or elsewhere. This is very concerning because the polluted water enters the
Sungai Jawi when the sluice gate is opened.

When the quality of the water is poor, of course the marine life such as fish communities will
be endangered. The SAM authorities have interviewed some anglers who occasionally fishing near
the bank of the Sungai Jawi and found out that they frequently saw blackish colour water enter the
sluice before it is releases into Sungai Jawi. They also questioned the quality of the water from the
industrial park. Meenakshi Raman also said the authorities need to pay extra attention to the
environment especially at relatively remote area, which is far from the public access because it can
be a place of illegal activities to occur. Strict action must be taken to those parties that found guilty
before this matter become more serious in the future. The New Straits Times has contacted MBSP
Mayor Datuk Rozali Mohamud and awaiting his response.

The second issues in the news regarding the protest of local communities is happens at Kuala
Langat, Selangor. According to the News Straight Time written by Dawn Chan, the villagers who were
affected by the pollution have urged the responsible authorities to take action on the battery
manufacturing factory which cause pollution in the proximity of their homes. The folks want the
factory to stop operating and move out from the village. Mohd Nazri Afrizal, who represented the
residents, said they thought their nightmare was over in March when the factory’s business
operating licence was cancelled by the Kuala Langat District Council (MDKL). However, the factory
dared to conduct illegal plumbum melting activities when they were only allowed to fill acid into
batteries. This released lead fumes into the air and contaminated the soil and drain water.

The villagers were shocked and disappointed knowing that MDKL grant temporary business
operating licence to the factory to continue operate from June 19 to August 19. MDKL grant the
licence to the factory after the Department of Environment said it had no objection to it. The
villagers hopes that after the temporary licence is expired, the factory will stop from operating and
moves to new site location that is suitable to operate at a heavy industrial area. The villagers said
the place is only suitable for light industrial area as it is near from residential homes and school. En.
Nazri along with 30 villagers conducted a peaceful protest in front of the factory for 30 minutes
while held placards that read “Why is MDKL still issuing licence?” “Battery factory must move out of
Jenjarom” and “What has happened, MDKL?”. Nazri said they were also working closely with the
Kuala Langat Environmental Action Group on this. They have also written to the Selangor
Environment, Green Technology and Consumers Affairs exco Hee Loy Sian; Energy, Science,
Technology, Environment and Climate Change minister Yeo Bee Yin; Housing and Local Government
minister Zuraida Kamaruddin as well as Water, Land and Natural Resources minister Dr A. Xavier
Jayakumar, who is also Kuala Langat member of parliament.

According from both issues, we agree with the suggestion of the villagers and authorities to
take necessary action such as examine thoroughly the license to operate as well as relocate the
factory to more suitable location such as heavy industrial area. Firstly, we agree with the initiative
from the companies in Penang who wants to recycle the plastic waste to reduce the pollution.
However, a proper waste management system must be provided to avoid from the plastic to cause
pollution into the drains hence endangered the marine life. Secondly, we also agree with the
suggestion from the villagers which is to relocate the factory to more suitable location. The company
must properly consider location of the site as well as the potential impact on the surrounding
environment to help reduce harmful consequences. Thirdly, we also agree with initiative from SAM
which requesting the authorities to provide stricter law and enforcement to correct the damage
from the industrial pollution.
Q4 Name two ISO standards related to environmental and energy. Where can we get the
information on how to apply certification for these ISO? Who audit and provide certification
for these ISO in Malaysia?

a) i. ISO 14001:2015 – Environmental Management System (EMS)

ii. ISO 50001:2018 – Energy Management System (EnMS).

b) We can get information on how to apply this certification from main website of
SIRIM QAS International Sdn Bhd (https://www.sirim-qas.com.my/our-services).

c) SIRIM QAS International Sdn Bhd will audit and provide ISO Certification for these
ISO in Malaysia.
Q5 Find two different industrial plant layout design (not from the existing article) and
comment
on the layout based on what you understand should be the main consideration of a good plant
layout. (6 Marks)

Answer:

Figure 1: Plant layout 1

Figure 1 show typical refinery layout, in our group opinion, blast walls may be needed
to isolate potentially hazardous equipment and confine the effects of an explosion. At least
two escape routes for operators must be provided from each level in process buildings. The
spread of fire from its origin to other parts of the premises can be prevented by vertical and
horizontal compartments using fire-resisting walls and floors. Consideration should also be
given to the spread of flammable material via drains, ducts and ventilation systems. Delayed
ignition following a release may result in the spread of flames.

In particular, evacuation routes should not be blocked by poor plant layout, and
personnel with more general site responsibilities should be housed in buildings sited in a non-
hazard area near the main entrance. Consideration should be given to the siting of occupied
buildings outside the main fence. In all cases occupied buildings should not be sited
downwind of hazardous plant areas.
 Figure 2: Plan Layout 2

From our group opinion, the principal factors that were considered in the optimum
design of the plant layout were the process requirements, convenience of operation,
economic considerations (construction and operation costs), and safety of workers and
visitors to the site as shown in Figure 2. As we can see the storage of flammable/toxic
material was located outside process areas. Location of hazardous plants also located away
from main roadways through the site. This layout have two escape routes for operators if any
emergency occur.
Q6.Compare the incentives provided by government from 3 different countries (including Malaysia) to
encourage industries to build their site there.

Egypt
General Incentives

The company's Articles of Association, credit facility agreements and mortgage contracts are all
exempted from stamp duty and notarization fees for five years starting from the
company's registration date in the Commercial Register.

Land registration contracts necessary for company establishment are exempted from the related
fees.

All imports defined as equipment necessary to establish and operate a project are liable to a
unified customs tax of 2%.

In compliance with the provisions of the Customs Law, industrial projects, subject to the
provisions of Egypt's Investment Law, are exempted from custom fees on production inputs
imported and used - for a temporary period – in the manufacturing process for export purposes.

Speciall Incentives

Investment projects established after the implementation of this law, in accordance to the
investment map, are granted special incentives through deductions from their net profit before
tax.

Additional Iincentives

Additional incentives may be provided via a decree from the Prime Minister such as:

It is allowed to establish custom points dedicated for imports or exports of an investment project,
after approval by the Minister of Finance.

The State reimburses the costs of connecting utilities to buildings related to the investment
project.

The State reimburses part of the vocational training expenses.

50% of the land value allocated to industrial projects will be repaid, conditional to production
commencing within two years from the date of receiving the land.

Free land may be allocated to some strategic projects as per regulations stipulated in the
law.
If necessary, non-tax incentives can be added via a Prime Minister's decree and according to a
proposal from the relevant minister

https://www.investinegypt.gov.eg/english/pages/gettingstarteddetails.aspx?CategoryId=1

Qatar
Investment

Qatar provides many investment incentives including low electricity, water and gas rates;
nominal lease rate of only (5) Qatari Riyals per square meter per year for industrial land sites for
the first three years from site assignment and project operation, after which lease rate will
increase to (10) Qatari Riyals; exemption from import taxes on heavy duty machinery and their
spare parts and raw materials; exemption from import taxes; unlimited quantities of imported
materials; no restrictions on money exchange and transfer of profits abroad; and flexible
regulations and procedures to import skilled and unskilled workforce.

General Incentives

The foreign investor has the right to import for his investment project what is necessary for the
establishment, operation, or expansion.

The invested foreign capital is exempted from tax income for no more than ten years from the
day the project was operated.

Customs exemption on an industrial project on its imports of raw materials or half manufactured
goods necessary for production and not available in the local market.

Incentives Offered to Investors

Allow investment opportunities and prepare primary studies for industrial projects.

Assist licensed industrial projects to obtain loans from banks of industrial development and other
financial organizations.

Provide the project with power, petroleum, water, and natural gas at competitive prices.

Investment Sectors

Based on law No 13 for 2000 on the organization of non-Qatari capital investment, non-Qatari
investors can invest in all fields with a shareholding of 49% and 100% in the following sectors:
Agriculture, Industry, Health, Education, Tourism, Development and utilization of natural
resources, mining, Consultation services, Artwork services, Information technology, Cultural
services, Artwork services, Sports Services, and Entertainment services. As for the banking
sector, it is possible to establish a bank by a decision from the council of ministers. Foreigners
have the right to own real estate at certain locations in the country.

Law No. (2) of the year 2000 was issued to regulate the possession of real estate by GCC
citizens. This law limits their activity to three estates for residential purposes at an area of not
more than three thousand square meters. The law also requires five years to pass before
naturalized citizens can own real estate in the country. Within the State's framework to
encourage foreign investment in Qatar's real estate market Law No. (17) for the year 2004
regarding the organization of ownership and use of real estate and residential units by non-
Qataris was issued. This law authorized the usufruct of real estate in the Pearl of the Gulf Island,
the West Bay Lagoon Project, and the Al Khor Resort Project. The law also authorized the
usufruct over real estate for a term of ninety-nine (99) years renewable for similar terms in the
Investment Areas decided by the Council of Ministers' Decision. Law No. (6) for the year 2006
issued by the Council of Ministers, identified eighteen (18) areas of the state real estate that may
be usufruct by non-Qataris.

https://mofa.gov.qa/en/qatar/economy-today/investment-incentives

Malaysia
Malaysia has a wide variety of incentives covering the major industry sectors. Tax incentives can
be granted through income exemption or by way of allowances. Where incentives are given by
way of allowances, any unutilized allowances may be carried forward indefinitely to be utilised
against future statutory income, except for certain incentives, such as reinvestment allowance
and investment allowance for approved service projects, where a seven-year limitation applies.

In compliance with the Forum on Harmful Tax Practices (FHTP) criteria under the Base Erosion
and Profit Shifting (BEPS) Action 5 (Countering Harmful Tax Practices More Effectively,
Taking into Account Transparency and Substance), Malaysia has amended the legislation in
relation to the tax incentives to:

 remove ring-fencing features

 exclude IP income from the incentives, and
 stipulate the substantial activities requirements.
Pioneer status (PS) and investment tax allowance (ITA)

Companies in the manufacturing, agricultural, and hotel and tourism sectors, or any other
industrial or commercial sector, that participate in a promoted activity or produce a promoted
product may be eligible for either PS or ITA.

PS is given by way of exemption from CIT on 70% of the statutory income for five years and the
remaining 30% is taxed at the prevailing CIT rate. ITA is granted on 60% qualifying capital
expenditure incurred for a period of five years and is utilized against 70% of the statutory
income, while the 30% balance is taxed at the prevailing CIT rate.

Special incentive schemes

Reinvestment allowance

 A resident company in operation for not less than 36 months that incurs capital
expenditure to expand, modernize, automate, or diversify its existing manufacturing
business or approved agricultural project is entitled to reinvestment allowance as follows:
 The allowance is given for 15 years from the first year of claim.
 The allowance is computed at 60% of QCE incurred and can be utilized against 70% of
statutory income.
 The 70% restriction does not apply to projects that have achieved the level of
productivity as prescribed by the Minister of Finance.
 The allowance will be withdrawn if the asset for which the allowance is granted is
disposed of within five years.
 A special reinvestment allowance of 60% of QCE will be given for years of assessment
2020 to 2022 for companies that have exhausted their existing 15-year reinvestment
allowance period and special reinvestment allowance granted for years of assessment
2016 to 2018.

Special ITA for electrical and electronic (E&E) sector

Companies in the E&E sector that have exhausted their eligibility for reinvestment allowance are
eligible for a special ITA of 50% on QCE to be set off against 50% of statutory income for a
period of five years (applications received by 31 December 2021).

Incentives for relocating to Malaysia

The following incentives are given to encourage investment and relocation of manufacturing
operations into Malaysia:
 0% tax rate for 10 or 15 years for new companies that invest a minimum of MYR 300
million or MYR 500 million, respectively, in the manufacturing sector in Malaysia.
 ITA of 100% for five years for existing companies in Malaysia to relocate their overseas
manufacturing facility for a new business segment to Malaysia with a minimum
investment of MYR 300 million
https://taxsummaries.pwc.com/malaysia/corporate/tax-credits-and-incentives