KUALA LUMPUR — Prasarana Malaysia Bhd said it will work with the Finance Ministry and both its Project Delivery Partners (PDPs) to reduce the total cost of the light rail transit line (LRT3) project.
In a statement yesterday, the state-owned transportation company said it acknowledged minister Lim Guan Eng’s statement on the increase in the total cost of the project.
Prasarana president and group chief executive officer Masnizam Hisham, who was appointed in January to replace Datuk Seri Azmi Abdul Aziz, said the management had begun cost-cutting measures since February.
“We will continue to work closely with the Ministry of Finance and Project Delivery Partners Malaysian Resources Corp Bhd (MRCB) and George Kent (M) Bhd to identify additional areas that may help reduce costs,” said Masnizam.
Prasarana’s statement came after Lim’s call for a drastic cost reduction to make the project feasible and cost-effective, as the projected total cost of the project had escalated to RM31.45 billion.
The latest cost estimate is significantly higher than the RM15 billion cited in recent news reports. The original estimate when the project was launched in 2015 was RM9 billion.
Lim blamed Prasarana’s poor management, adding the ministry would not support additional funding for the project unless the cost is “significantly rationalised without compromising the rail network’s integrity as well as the safety and quality of service provided”.
The 37km line from Bandar Utama to Klang through Shah Alam is expected to serve a two-million-strong population with the capacity to transport 36,700 passengers per hour each way.
In 2015, Prasarana appointed MRCB and George Kent as PDPs for the project at an approved construction budget of RM9 billion.