KUALA LUMPUR, June 18 — YTL Corporation is withdrawing from a consortium that will build a RM3 billion power plant in Johor that secured the job through direct negotiations, in a bid to dispel the suspicions surrounding the project’s award.

The decision comes after controversy descended on the news that a consortium involving a YTL subsidiary, a firm belonging to the Sultan of Johor and Tenaga Nasional Berhad (TNB) Nasional had been chosen to construct the so-called Track 4A gas-fired power plant in the state.

“We are thankful to the Government for having confidence in YTL Power, as part of the consortium, to deliver the Project on a fast track basis.

“However, in view of the misconception over the Project, YTL Power has decided not to participate in the Project under the present arrangement to dispel any misgivings over the Government’s commitment to transparency and good governance,” YTL Power said in a statement today.

Attention was trained on the project to build the 1,000-1,400MW combined cycle power plant owing to Tan Sri Francis Yeoh’s remarks touching on the problem of “crony capitalism”, which he made at a recent public forum.

The head of YTL Corporation had then sought to banish the perception that that he was a beneficiary of former prime minister Tun Dr Mahathir Mohamad’s political patronage, particularly in the lucrative independent power producer (IPP) sector that the former said he had mooted.

Among others, the controversy had prompted the Tenaga Nasional Berhad Junior Officers Union to remind Yeoh that he had made gains from various government projects, including those from independent power producers, according to a report by Umno-owned Malay language paper Utusan Malaysia.

Today, YTL Power said it would welcome the opportunity to participate in the Track 4A project on a “competitive basis” or in a different capacity, saying it was confident it would be also able to do so on an accelerated schedule.

On May 31, the Energy Commission announced the award of the project to the consortium on a conditional basis.

The news was met with resistance owing to the backdrop of discontent surrounding Yeoh’s remarks.

Complicating matters further was the confusion that descended on the project when TNB at first appeared reticent over its participation, and later began distancing itself from the consortium.

YTL Corporation, an infrastructure conglomerate, is one of Bursa Malaysia’s largest firms. Together with its listed subsidiaries, it has a combined market capitalisation of over RM30 billion.