The Johor Port Authority is working to develop a US$477 million oil storage and ship refueling site.
The Bunker Island Development, near Tanjung Bin, is set to have the capacity to store about 1.2 million cubic metres of various oil and gas products.
It will be used for storage, blending and redistribution.
The Johor Port Authority had signed a sublease agreement with Smart Crest Sdn Bhd, which is funding the development.
The fully-funded private sector project is located within the Free Commercial Zone of Tanjung Pelepas, and sits on 100 acres of the reclaimed island at Tanjung Bin.
The development of Bunker Island will take four years to complete.
The project will have 61 tanks located in five tank pits, a storage capacity of about 1.2 million cubic metres, two jetties and seven berths, as well as capabilities to handle various type of products.
The first phase of the project, which is the oil tank development, is scheduled to complete within two years, so that it can start generating revenue for the next phase of development.
The project is being revived after it was reportedly abandoned for some 17 years,
The authority has given the project developers a 30-year lease period, with a rent of US$119,332 (RM500,000) a year for the first two years.
Subsequently, a lease payment of US$522,676 (RM2.19 million) would be imposed for the third, fourth and fifth years, with a 10% increase in rent once for every five years.