According to the Minister, the new terminal, to be called KLIA East@ Labu, would be built under a private finance initiative by conglomerate Sime Darby Bhd and budget airline AirAsia and will boast connectivity by both road and rail.

A 7 km branch road will link it with the North-South Expressway and a 3 km spur line will be built from the railway station in Labu – a stop on the KL-Seremban KTM Komuter route.

Welcoming the project's approval, Menteri Besar of Negri Sembilan, Datuk Seri Mohamad Hassan said the Kuala Lumpur International Airport (KLIA) would be connected to the new terminal by a 7 km Express Rail Link (ERL).

"The location is not far from the existing terminal. It will be an extension of the KLIA. When the airport is built, the state can expect economic development, such as housing estates and business centres, in the surrounding areas," said Mohamad.

Ong said the new terminal was needed as the current facility in Sepang would not be able to cope with the increased passenger volume.

Under its final expansion phase, after which there will be no more room for growth, the Sepang LCCT will have its capacity increased to 15 million passengers a year, a figure industry sources say is likely to be exceeded by 2011.

Including its Thai and Indonesian affiliates, AirAsia flew some 18 million people this year. The new terminal will be built to accommodate 25 million passengers a year, and last on present forecasts until 2030.

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