The government has approved the continuation of the Light Rail Transit 3 (LRT3) project at a final total cost of RM16.63 billion—down 47 per cent from RM31.65 billion.
In a statement, Finance Minister Lim Guan Eng said this will include all project costs, including but not limited to Work Package Contracts (WPC), land acquisition, project management, consultancy fees, operational and overhead costs, as well as interest during construction.
The RM15.02 billion savings was the result of a thorough renegotiation and rationalisation exercise of the LRT3 project with all key stakeholders, including Prasarana, the project delivery partner MRCB-George Kent (M) Bhd joint venture (MRCB-GK JV), and the Land Public Transportation Commission (SPAD).
Part of the cost savings came from the cancellation of a 2-kilometre LRT tunnel and underground station at Persiaran Hishamuddin in Shah Alam, Selangor, and the extension of the completion timeline from 2020 to 2024. Other changes include the halving of the order of train carriages, the streamlining of the size and design of the LRT train depot and stations, and the shelving of five stations where projected ridership is low.
“One critical criteria for the review was that the integrity of the 37-kilometre LRT3 line from Johan Setia (Klang) to Bandar Utama (Petaling Jaya) must be maintained,” he said. “In addition, the safety, frequency and quality of service must meet the requirements of the regulators.”
The construction of the project will be restructured from a PDP model to a ‘fixed price contract’ with MRCB-GK JV to ensure no cost overruns. The deal will also result in a RM14 billion savings in interest cost over the period of the loan financing.
Further details of this contract will be disclosed at a later stage, said Lim.
The LRT3 project is expected to serve a 2-million population and alleviate traffic congestion along the economic development corridors in the Klang Valley, from Klang to Petaling Jaya. — Construction+ Online