A former Penang state executive councillor today said he had been instructed by Lim Guan Eng to work with the Beijing Urban Construction Group (BUCG) from day one even though the Penang undersea tunnel project was supposed to be awarded through open tender.
Former Penang Public Works, Utilities and Public Transportation committee chairman Datuk Lee Hock Seng revealed that Lim had in early 2011 instructed him to get in touch with Datuk Zarul Ahmad Mohd Zulkifli – the managing director of Consortium Zenith Construction, and BUCG’s local representative Lee Chee Hoe.
The former Bagan Jermal assemblyman said Lim gave him the duo’s mobile phone numbers with the instruction that they were interested in exploring the undersea tunnel project.
“I was told to contact them in relation to the tunnel project and I did so.
“Shortly after that, the state government signed a memorandum of understanding (MOU) with BUCG on the company’s interest to undertake the project. At that time BUCG had estimated it to cost about RM10 billion,” he said.
Lee, who has been a DAP member since the 1980s, said BUCG eventually invited Lim to visit its headquarters in China, following which the latter led a 10-member state delegation to Beijing.
The cost of the six-day visit to China from June 2 to 8, 2011, he said, was fully borne by the Penang state government.
“The state government paid for our flight tickets, accommodation, food and drinks,” Lee said.
Hock Seng was testifying on the third day of the former finance minister’s corruption trial linked to the project.
Zarul and Lee are senior executive directors of Consortium Zenith Construction Sdn Bhd, the main contractor for the project. The two are key prosecution witnesses.
During examination-in-chief by deputy public prosecutor Nik Haslinie Hashim, Hock Seng testified that early that year, he directed the Penang Island City Council engineering department director to prepare a working paper on the project.
He told the court that during a Penang state Exco meeting on March 16, 2011, he informed the council that BUCG had asked for the MoU to be signed as soon as possible.
At another state government council meeting on March 16, 2011, Hock Seng said he informed those present that BUCG representatives were urging the Penang government to ink the MoU “as soon as possible”.
This eventually led to the signing of a MoU on March 17, 2011, in which both parties agreed to cooperate in alleviating persisting traffic congestion issues in Penang.
The MoU was then tendered in court as an exhibit and affirmed by Hock Seng who testified that two signatures on the document belonged to state government secretary Datuk Farizan Daus and Zarul as BUCG representative. The third signature on the MoU was his own as a witness, Hock Seng said.
Subsequent to the March 2011 MoU, Hock Seng said Guan Eng had on April 27 informed the state government council meeting that the latter would sign another MoU with the BUCG chairman in Putrajaya on April 28.
“The MoU was for the proposal of an undersea tunnel project spanning 5km in length with an expected cost of RM10 billion and fully funded by BUCG themselves.
“Based on this document, I confirm that this MoU explicitly states the company’s interest in taking on the project and that the project was to be implemented through open tender,” he said.
The witness claimed that after the draft MoU was checked by the state legal adviser, he called Farizan and BUCG representatives to his office at Komtar on March 17, 2011, where the parties signed the MoU.
He said Guan Eng later attended an official signing ceremony for the MoU at Putrajaya on April 28 that same year, which was also witnessed by the prime ministers of Malaysia and China.
Hock Seng said on May 19 the same year, Guan Eng also directed him to speed up the Request for Proposal (RFP) related to the project.
The 73-year-old was testifying as the third prosecution witness in Lim’s corruption trial. The DAP secretary general is, among other things, accused of soliciting a 10 percent cut in profits from the tunnel project, from Zarul.
Lim, who is former Finance Minister, is also accused of seeking RM3.3 million in kickbacks to appoint Zarul’s company to undertake the project.
He also faces two counts of dishonestly misappropriating RM208.7 million worth of state land to two companies.
It was previously reported that BUCG, which is one of China’s largest construction companies, had been awarded the RM6.3 billion project to construct three main roads and the undersea tunnel after partnering with Zarul’s Consortium Zenith Sdn Bhd.
Lim’s administration had then said the consortium was awarded the contract after an open tender which attracted about 60 bids.
BUCG eventually withdrew from the partnership in 2016 after a fallout with the state government over a fatal crane accident which left a woman dead.
During today’s hearing, Lee also touched on two plots of state land which had changed hands as payment for a feasibility study conducted for the tunnel project.
He said the two plots on Lot 702 and 713 had been signed off by Lim apart from another RM31 million which was paid also for the feasibility study.
Asked by Deputy Public Prosecutor (DPP) Nik Haslini Hashim whether he was sure that the land swapped as payment did not belong to Lim, Lee said:
“No (it was not Lim Guan Eng’s land).”
Meanwhile, the noon session of the hearing today was adjourned after Lim’s lead counsel Gobind Singh Deo informed Sessions Court Judge Azura Alwi that he needed to go for a Covid 19 swab test.
The lawyer said he had been informed that his secretary had tested positive for the virus and therefore he needed to get tested.
Gobind said he was in close proximity with the secretary three days ago for less than five minutes during a visit to the constituency to distribute food aid.
The lawyer added that he would be getting a swab test today and that he would inform the court of the result later.
Azura then allowed proceedings this afternoon to be adjourned, and to tentatively resume tomorrow, depending on the outcome of the test.
“With new (Covid-19) variants and (high new case) numbers now are very alarming, I remind parties to abide by the SOP (standard operating procedure), hence, we limit and restrict the number of persons (coming to court proceedings).
“This is not a normal situation, with the (new Covid-19 daily case) numbers now, we have to be strict with that.
“It is not my intention to restrict proceedings to anyone. It is better we take extra precaution,” Azura said.
Only a few deputy public prosecutors and lawyers were allowed into the Sessions Court today, while members of the media followed the proceedings via a live stream at separate rooms in the Kuala Lumpur Courts Complex.
Earlier report: Jul 13, Guan Eng’s corruption trial: Actress testifies of 2am business meeting