The controversial RM6.3 billion Penang undersea tunnel and roads project is far from dead.
In fact, it has been given new life with a Kedah-based developer clinching a deal to take over the project through the purchase of majority shares in the company awarded the project.
The state government has given its blessings to the Kedah company, led by a Penang businessman with a “Tan Sri” title, to take over the project, said a source.
“The state executive council gave its nod for the takeover in early December. The new company will breathe new life into the project, which was hampered by MACC probes over the years. The Tan Sri is the white knight of the project,” the source said.
FMT has contacted chief minister Chow Kon Yeow for comment.
While the exact value of the takeover could not be ascertained, it was learnt that the incoming company would absorb liabilities and other costs as well. The source said the Kedah company will pay in instalments once work starts on each component of the project.
Last October, the tunnel and road builders Consortium Zenith Construction Sdn Bhd (CZC) told FMT that it was in the midst of an “internal restructuring” so the project could roll out smoothly.
A source had earlier told FMT that the restructuring was an effort to rescue the image of CZC and the tunnel and roads project, which had been severely affected by corruption allegations, among others.
Chow had then said that the company was free to carry out any restructuring it liked and that the state would consider it so long as it is within the earlier signed contract period. The Penang government is the project owner.
FMT had earlier reported that there were three companies vying for the takeover of the project, primarily the Kedah-based company, a Pahang-based mining and construction company; and a Kuala Lumpur-based engineering firm.
The Pahang-based company was said to be teaming up with a former federal minister for the project. The KL-based firm is also a familiar party that had done work for the project before.
The undersea tunnel and roads project was mooted by the Penang government to alleviate traffic on the first bridge and to cut down traffic at other congested corridors on the island.
The 7.2km undersea tunnel is planned to be built from George Town to Butterworth if feasibility studies come back positive.
Besides the tunnel, three bypass roads are to be built: Air Itam to Tun Dr Lim Chong Eu Expressway (5.7km); Tanjung Bungah to Teluk Bahang (10.53km); and Gurney Drive to Tun Dr Lim Chong Eu Expressway (4.1km). – FMT