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KUALA LUMPUR, July 10 — The Ministry of Finance blamed Prasarana Malaysia today for poorly managing the Light Rail Transit 3 (LRT3) project that caused projected costs to triple from RM10 billion to RM31.45 billion.
Finance Minister Lim Guan Eng noted that Prasarana Malaysia previously secured a government guarantee for an RM10 billion bond facility to fund the Klang Valley project in 2015, but the government-owned public transportation company requested for an additional RM22 billion in government guarantee on March 30 this year to ensure funding to complete the project.
“The Ministry of Finance has already requested Prasarana to drastically review the cost of the project to ensure its viability.
“The Ministry of Finance will not support any additional funding required for the project unless the cost of the LRT3 project is significantly rationalised without compromising on the integrity of the rail network as well as the safety and the quality of service provided,” said Lim in a statement.
The finance minister also said “much more” than RM6 billion must be reduced from the cost of the LRT3 if the project was to proceed.
The 37km LRT line from Bandar Utama to Klang through Shah Alam was expected to serve a two million-strong population with the capacity to transport 36,700 passengers per hour each way.
The Star reported that the cost of the LRT3 project rose because Prasarana Malaysia ordered changes to the original design of the track, such as increasing the number of stations from 26 to 30, increasing the number of cars for each train from four to six, and cutting the project completion time from eight years to six.
In 2015, Prasarana appointed Malaysian Resources Corp Berhad and George Kent (M) Berhad as the project delivery partner (PDP) for the LRT3 project at an approved construction budget of RM9 billion.
When the LRT3 project was launched in 2015, it was projected to cost RM10 billion, including RM1 billion set aside for land acquisition.
The construction of the 51km Mass Rapid Transit (MRT) Line 1 from Sungai Buloh through the city centre to Kajang, with 31 stations, cost RM21 billion, below the budget of RM23 billion.