Penang Undersea Tunnel Still Active, Not Abandoned — Technical Issues Being Refined, Says Chief Minister

The Penang undersea tunnel project remains active and has not been categorised as abandoned, according to Chief Minister Chow Kon Yeow. He clarified that ongoing technical refinements and design assessments are still underway as the state government continues evaluating the most viable alignment and construction approach.

Chow said the companies involved in the project recently presented updates during the State Exco meeting, allowing the government to reassess outstanding issues and outline necessary steps to move the project forward.

According to him, the project’s engineering requirements are closely linked to the expansion of Penang Port, which may influence the alignment of the proposed crossing. If the state opts to replace the tunnel with a bridge, its height must comply with aviation and security requirements due to its proximity to the Royal Malaysian Air Force (RMAF) Butterworth Air Base.

“These are technical matters that still require refinement. Under the master agreement, the study phase has not concluded. The project cannot proceed until all parties agree on the alignment design and the financial structure,” Chow said during the state assembly session on Friday.

His explanation came in response to Azmi Alang (PN–Telok Ayer Tawar), who sought an update on the long-debated Penang undersea tunnel.

Bridge Proposal Under Review

In May, the state government announced it was evaluating a proposal to switch from an undersea tunnel to a bridge crossing the Penang Straits. Infrastructure, Transport and Digital Committee chairman Zairil Khir Johari previously confirmed that the feasibility study was finalised in 2023, including assessments of both a bridge option and alternative structures.

The 6.5km link—intended to connect Gurney Drive on Penang Island to Bagan Ajam on the mainland—is one of the key components of the Penang Transport Master Plan, designed to enhance long-term mobility and economic connectivity across the state.

Wider Market Implications

Major infrastructure projects like this often influence surrounding property markets across the northern region, similar to how improved accessibility in the Klang Valley drives demand for industrial land in Selangor, transit-linked office space in Bukit Jalil, and strategic factory sites in Puchong. Major transport expansions also tend to uplift values of commercial property in KL and upgrade industrial demand in locations such as the industrial property markets in the Subang area.

As Penang refines the tunnel or bridge design, the eventual transport link is expected to have long-term economic spillovers for both the island and the mainland.