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Thursday, June 22, 2017

Rahman Dahlan wrong on fees, says Zenith chairman

Zarul Ahmad Mohd Zulkifli says top officials from works ministry, including minister, had no objection during presentation on project and costs last April.
Zarul-Ahmad-rahman-dahlanGEORGE TOWN: A federal minister’s claim that the Penang government overpaid consultants for three major road projects was based on wrong information, the company which won the RM6.3 billion open tender in 2013 said today.
Consortium Zenith Construction Sdn Bhd (Zenith) chairman Zarul Ahmad Mohd Zulkifli said the fees paid covered not only the three major roads, but the undersea tunnel as well.
On Tuesday, BN Strategic Communications director Abdul Rahman Dahlan said the Penang government had overpaid for a detailed design component covering the three major road projects alone, paying consultants RM177.5 million, which he said was four times the actual cost.
Rahman, who is also a minister in the Prime Minister’s Department, said detailed design costs should “only be slightly over RM41 million”, as per guidelines set by the Board of Engineers (BEM), a federal engineers’ body.
Zarul however explained that the RM177.5 million paid was well within reasonable limits.
He also argued that there was no objection to the costings by the works ministry (which administers BEM), and the Penang branch of the Institute of Engineers’ Malaysia (IEM), when the relevant documentation was presented to them.
Zarul said a “full-fledged” presentation was also made to Works Minister Fadillah Yusof on April 6 this year. Others in attendance were the ministry’s secretary-general Zohari Akob, director-general Roslan Md Taha, and Highway Board director-general Ismail Md Salleh.
Penang Chief Minister Lim Guan Eng and state exco Lim Hock Seng also attended the meeting between Zenith and top ministry officials.
“There were no adverse statements, remarks or comments raised during the briefing,” he said in a press conference at Komtar.
Prior to that, Zarul said the Penang government briefed IEM’s Penang branch on Sept 2, 2015, with details of the briefing published in its newsletter on Aug 5, 2016.
He said IEM even remarked that the RM305 million overall cost of the feasibility study, detailed design, and environment impact assessment was “reasonable and competitive”.
“It was also found to be within the scale of fees stipulated by the BEM,” he said.
The RM305 million in question was broken down into two components, namely RM129.6 million for professional civil and structural fees, with the remaining RM177.5 million put under the spotlight by Rahman.
“The professional fees of RM129.612 million is equivalent to 2.36% of the project costs of RM5,490 million (excluding land acquisition, FSDD & EIA costs).
“The 2.36% is within the BEM’s scale of fees.”
Zarul also explained what the RM177.5 million covered:
  • civil, structural & geotechnical engineering design,
  • land survey,
  • detailed environment impact assessment,
  • quantity surveying,
  • land tunnel design,
  • architectural design,
  • mechanical and electrical works,
  • project management,
  • social impact study,
  • traffic impact study, and
  • financial feasibility and funding management
Zarul said since some of the projects’ scope of works was highly technical, Zenith had to engage the services of foreign consultants.
“As such, their fees are hard to be benchmarked as the current professional institutions in Malaysia do not have the standard scale of fees for special consultants to refer to.
“Therefore, their fees had to be benchmarked against international standard fees,” he said.
Zenith will build a 7.2km undersea tunnel by the coast of Gurney Drive to Bagan Ajam in Butterworth. The tunnel will be built at least 20 metres below the seabed.
The three major road projects are from Air Itam to the Tun Dr Lim Chong Eu Expressway, Tanjung Bungah to Teluk Bahang and Jalan Pangkor-Gurney Drive junction to the Tun Dr Lim Chong Eu Expressway. (The project was previously called “three-paired roads”.)
It is expected to be completed in 2025.
The project is separate but part of the bigger RM27 billion Penang Transport Master Plan (PTMP), which aims to build a network of new roads and public transport lines. -FMT

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