MMC-Gamuda ready for fresh negotiations over MRT2 project and also wants the PM to handle the issue.
A four-member cabinet committee has been formed to relook MMC-Gamuda’s contract to develop the underground portion of the Mass Rapid Transit 2 (MRT2) project, said Mohamed Azmin Ali.
The committee is expected to begin discussions soon, as Putrajaya does not want the project to be delayed.
“Soon, because we don’t want to halt the project. We want to discuss after examining the project, and decide as soon as possible,” the economic affairs minister told reporters after delivering a speech at the China Conference in Kuala Lumpur today.
A report by The Star earlier today, quoting a source, named Finance Minister Lim Guan Eng, Works Minister Baru Bian, Transport Minister Anthony Loke and Azmin as the committee members.
“Well, we have to discuss the entire project, in terms of costing, design, details, and certainly, we want to protect our workers,” said Azmin.
“We don’t want any parties to lose jobs.”
On Sunday, Lim announced that Putrajaya would scrap the MMC-Gamuda contract involving the underground portion of the MRT2 project, citing high costs as the reason.
He said the move would shave RM5.2 billion off the total project cost.
After the backlash by MMC-Gamuda staff following the firm’s public response to the termination of its MRT2 underground works contract, Damansara MP Tony Pua yesterday wrote a scathing open letter that took MMC-Gamuda to task.
Pua, who is political secretary to Finance Minister Lim Guan Eng, questioned MMC-Gamuda if it intended to foment public dissatisfaction with the ruling government.
He hit out at the firm for a petition initiated on Change.org to discourage the termination of the project for the welfare of the 20,000-odd workers they claimed would be affected.
“It might be more productive to start a petition to ask your bosses at MMC-Gamuda to make the Malaysian government an offer it cannot refuse,” he said in the letter.
Pua denied the project was being scrapped outright.
“You will find plenty of opportunities when the new project is awarded at a lower cost, while the savings generated would mean even more projects for the future,” he said.
He also wrote that MMC-Gamuda had refused to slash costs for MRT2’s underground works, leading to the cancellation of the contract.
Gamuda Bhd’s share price closed at 5 percent or 12 sen lower in morning trade after Pua’s letter.
The Sun said that the stock hit a 52-week low of RM2.25 before rebounding slightly to close at RM2.26, with some 51.8 million shares changing hands, making it the most active counter of the day.
It said Gamuda had lost about RM2.3 billion of its market capitalisation over the last few days alone, adding that its joint venture partner in the MRT project, MMC Corp Bhd, also continued its losing streak, dropping 1.72 per cent or two sen to close at RM1.14.
Reacting to Prime Minister Dr Mahathir Mohamad saying the government would review the decision, MMC-Gamuda said it hoped the government would invite it back to the negotiating table as part of that review process.
The firm said in a statement that it would adopt an “open book approach with the appointment of an international engineering consulting firm that possesses the necessary experience and track record in assessing tunnelling works around the world, and as such, be in the best position to re-examine where savings can be derived”.
It wants further discussions with the Finance Ministry in reaching an agreeable reduction in costs.
The firm added that it would leave the matter “in the good hands” of the Dr Mahathir.
It is believed that while MMC-Gamuda will most likely agree to a further reduction in costs, it will not reach the level expected by the ministry.