Construction could begin in August, with at least one coastal refinery that can process 200,000brld scheduled to be operational by the end of 2010. The 320-km pipeline from Kedah to NE Kelantan state would allow refined oil shipments to reach the South China Sea without traversing the Malacca Strait, which lies off peninsular Malaysia's west coast. The Strait, through which around half the world's oil shipments currently pass by tanker, is shared by Malaysia, Indonesia, and Singapore, and is notorious for robberies and kidnappings by pirates, although attacks have decreased following increased security patrols in 2005. About 70% of the funds to build the refineries and pipeline will likely come from foreign direct investment, creating "ample opportunities of income and job creation for growth and development," investment bank Aseambankers said in a research report earlier this month. Crude oil tankers from the Middle East will be moor off Kedah, from where the oil will be refined and be transported trough the pipelines to Kelantan and subsequently be loaded on to tankers and shipped to South Korea, China, and Japan, by-passing Singapore, the report said. However, laying the pipeline could be an "arduous and challenging feat," the report noted, stressing that environmental and land issues would need to be addressed. Malaysia's national oil-and-gas company, Petronas, is not involved in the project at present because the crude oil would be originating in the Middle East, not Malaysia, the Aseambankers' report says. Malaysian firms Merapoh Resources Corp. and SKS Ventures will build the refineries, while Trans-Peninsula Petroleum will construct the pipeline, the Kedah official said. The deadline for the complete project will be finalized later, he said.