Report: Gamuda moots private funding for MRT3 project

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Gamuda Berhad is looking to fund the third mass rail transit line project for the first two years via a private financing initiative. — Picture by Yusof Mat Isa
Gamuda Berhad is looking to fund the third mass rail transit line project for the first two years via a private financing initiative. — Picture by Yusof Mat Isa

KUALA LUMPUR, Nov 14 — Gamuda Berhad is looking to fund the third mass rail transit line project for the first two years via a private financing initiative (PFI), which could see the firm take on the role of project manager should the proposal go through.

Citing an unnamed source, The Edge reported today that the public-listed company made the proposition considering Putrajaya’s constrained spending ability.

According to the business paper, the MRT3 project could cost anywhere between RM27 billion and RM32 billion.

“Gamuda has proposed to the government that, for the MRT3 project, the funding for the first two years will be borne by Gamuda under a PFI given that the government’s finances are currently limited,” the source was quoted as saying.

“And after the two years are up, the project will then be handed over to the government once there is more fiscal space. Gamuda’s proposal is to take on the role as project manager.”

MRT3 will link both the MRT1 and MRT2 lines, forming a loop around Kuala Lumpur city.

Preliminarily, the line will have 30 stations, with 10 stations being interchange stations with other MRT, light rail transit and KTM Komuter lines.

In a briefing back in April, MRT Corp CEO Datuk Mohd Zarif Mohd Hashim said that the entire alignment will be about 50km.

Nearly half of it will be underground. The project is expected to take a decade to be completed, compared with the initial plan to complete it within seven years.

Citing other anonymous sources, The Edge reported last month that major construction companies had reportedly formed consortiums and joint ventures (JVs) to prepare for the eventual construction tenders for the project.

Construction giants with balance sheet strength the likes of YTL Corp Bhd, Sunway Construction Group Bhd and IJM Corp Bhd are said to be forming consortiums and JVs to prepare for the tender.

The Edge reported that the first source who spoke about Gamuda’s PFI proposal also suggested that MRT Corp could call for an international tender for the project’s systems and civil works integration.

“It is understood that MRT Corp is now mulling an international tender for integration between systems and civil works for MRT3,” the same source was quoted as saying.

“There is a view that the system works can be done on a PFI basis while an open tender will be called for the civil works, similar to what the Australian government and its private sector players,” the source added.

Gamuda is looking to participate in the tender process as the project integrator, according to the paper.

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