PUTRAJAYA, Sept 19 — The government today announced that it has cancelled a contract worth RM5.2 billion for Phase 2 of the KTM Klang Valley Double Track (KVDT) upgrading works.

Transport Minister Anthony Loke Siew Fook said the project will, however, proceed and be awarded to those interested via the process of open tender.

"The Cabinet decided to cancel said contract after taking into consideration its high cost. We hope to get a better, much lower value.

"It’s the new government’s policy to award tenders through the open process instead of direct negotiation,” he told a press conference at the Transport Ministry here.

Loke said the cancellation is sensible because the project, awarded to contractor Daya Maju on April 3, has only made three per cent of progress as of today.

He added that no payment has also been made to the contractor.

"On compensating the contractor, we will need to discuss first. We have not decided on an amount yet. It depends on them actually to make the claim,” he said.

Loke said his ministry was told to expedite the process but added that the tender would likely only be awarded early next year.

The project, expected to reduce waiting time for KTM Komuter by half, commenced in the third quarter of 2016.

Loke said Phase 1, between Rawang-Salak Selatan and Sentul-Simpang Batu is currently 50 per cent completed and expected to finish by November 2019.