FADILLAH RAISES 4 CONCERNS
Minister questions mode of payment and viability
THE Works Ministry yesterday highlighted four concerns about the proposed RM6.3 billion Penang undersea tunnel project. This comes on the heels of Prime Minister Datuk Seri Najib Razak’s comments on the project in a blog post.
Najib had said that there was no need to waste money building the tunnel when there were two bridges connecting the island to the mainland.
Works Minister Datuk Seri Fadillah Yusof said, firstly, the Penang government had said that the tunnel project would begin construction in 2023, but the project was awarded in 2013.
“It is highly unusual for any government to award a project that will start only a decade later as traffic and environmental situations may change.”
Fadillah said another concern was the mode of payment of using a pre-determined acreage of prime seaside land based on today’s value, which could mean that the state government might be overpaying for a future construction project.
“Given the fast appreciation in land value in Penang, it is not unreasonable to suggest that by the time the tunnel is ready in 2037, the cost of land given as payment would have doubled or tripled in value.”
He said the state government giving the contractor a 30year toll concession at the same rate as the Sultan Abdul Halim Mu’adzam Shah Bridge would make this among the most lop-sided toll concessions in the country.
“This is unlike the standard concession agreements where the toll concession company funds the construction cost, and collects toll to repay its loans and see a profit.”
He said the state government had sent a letter to the ministry almost two years ago, asking about the possibility of building a bridge instead of a tunnel.
“The Penang government has yet to revert to us on any supporting documents, including the overpriced RM305 million reports, despite repeated requests from us.
“This leads the ministry to question the sincerity of the state government’s request.
“We are concerned that the tunnel may not be financially viable considering that the utilisation rates for the first and second bridges are at 87 per cent and 50 per cent respectively.
“Both can be maximised and expanded.
“There is no urgent need to build a new one.”
Fadillah said although the 10.5km Tanjung Bungah to Teluk Bahang North Coastal Ring Road might cut travelling time by 10 minutes at a cost of RM1 billion, it would be built on environmentally-sensitive steep hillslopes, which might lead to bottlenecks that could cause congestion in the surrounding traffic system.
The tunnel project comprises a 7.2km undersea tunnel linking Gurney Drive on the island to Bagan Ajam on the mainland and three paired roads.
The roads are the 10.53km Tanjung Bungah to Teluk Bahang North Coastal Ring Road, 5.7km paired road from Air Itam to the Tun Dr Lim Chong Eu Expressway bypass and 4.075km road from Gurney Drive to the Tun Dr Lim Chong Eu Expressway bypass.
The tunnel project had raised eyebrows in recent months, especially on the high cost of the RM305 million feasibility study and the 22-month delay in completing it.
The controversial project is being investigated by the Malaysian Anti-Corruption Commission.
Four people — a Datuk Seri, two Datuk and a female engineering consultant — have been detained to assist in investigations.