Highway cost overshoots by $312 million

PETALING JAYA - Construction delays in sections of the East Coast High-way 2, a mega project under the Ninth Malaysian Plan, had cost the Federal Government an additional RM800mil (S$312 million), according to the Auditor-General's Report 2012.

The construction of the 184km, four-lane, two-way highway, which starts at Jabur, Kemaman and ends at Kampung Gemuruh, Kuala Tereng­ganu, was divided between the Public Works Department (PWD) and the Malaysian Highway Autho­rity (LLM).

LLM completed its portion that covers 64km, from Bukit Besi to Telemung along with a 16km spur route, on May 18 last year while the sections under PWD includes managing the construction of stretches from Jabur to Bukit Besi and from Telemung to Kampung Gemuruh.

This included 120km of roads, in addition to a 19.4km spur road, which was projected to cost RM2.09bil but had since risen to RM2.9bil.

The work was divided into 16 sections which PWD tendered out to 12 companies.

Eight contractors failed to complete their projects on time, despite being given extensions of between eight and 18 months, along with variation of price (VOP) which went up to RM31.87mil.

Among these companies were Arah Jitu Sdn Bhd and GPQ Bukit Putri JV, which were contracted to build two sections each. Arah Jitu failed to complete both sections while the latter managed to finish one.

The errant companies had their contracts terminated and the work was re-tendered in 2010.

This process took between 11 and 19 months, causing further delays along with cost due to damage at the construction sites during the period.

To date only 66.92km of the PWD's project has been completed, but only 11.58km is open.

PWD attributed the delays to the time taken by the Works Ministry to approve the re-tendering work and getting additional allocations for the project.