CZBUCG faces delays in Penang projects, sues politician

KUALA LUMPUR: Consortium Zenith BUCG Sdn Bhd (CZBUCG), which is facing a delay in its RM6.3 billion major roads and undersea tunnel project in Penang, served a legal notice on Monday against Parti Cinta Malaysia (PCM) vice-president Datuk Huan Cheng Guan for defamation.
“Huan’s media statements are defamatory, which have critically jeopardised the project and our reputation. It also directly impacts the ongoing and future negotiations with current and future potential investors,” CZBUCG chairman Datuk Zarul Ahmad Mohd Zulkifli told reporters at a press conference yesterday.
The RM6.3 billion project comprises three major roads measuring about 20.5km in total and a 7.2km undersea tunnel connecting Penang island to the mainland. Construction work for the three major roads has been delayed while the feasibility study for the undersea tunnel has been halted.
“The state government told us to stop the feasibility study and detailed design (83% completed) for now. We were not told the reason. I think they want us to start on the three major roads as soon as possible,” said Zarul.
He said it was told to stop the feasibility study for the undersea tunnel about a month ago. To date, the consortium has spent close to RM100 million on the feasibility study and detailed design, for which it has not been paid yet.
On whether the undersea tunnel will be cancelled or replaced by a third bridge, Zarul said it is up to the state government to decide.
“There is no compensation in the agreement. Whatever work we have done, we will claim from them,” he said, when asked about compensation if the undersea tunnel is scrapped.
Meanwhile, the feasibility study and detailed design for the three major roads have been completed and construction work is expected to start in September, pending approval from the Department of Environment and land acquisition.
“To start work, we need the preliminary environmental impact assessment (EIA) approval. We hope to get it soon, maybe in the next two months ... we are ready to move to the site but we cannot do so until we obtain the preliminary EIA approval,” said Zarul.
In August last year, it was reported that the approvals would be obtained by end-2015 and construction was to start early this year, with completion slated between 2018 and 2022.
“Under the agreement, an environmental consultant has to be appointed by the state government and there has been some delay on that part,” he said, adding that the consortium has already done its part.
He said it does not expect any further delays to the three major roads as the feasibility study and detailed design have already been completed and approved, and the state government has not given any indication of cancelling the project.
To date, CZBUCG has completed RM220 million worth of works for the three major roads and has received one parcel of land worth RM135 million.
However, CZBUCG said it has received only 3.67 acres of land to date, out of the total 110 acres promised by the state government as payment-in-kind.
The consortium has planned a roadshow throughout Penang after Hari Raya to brief the local communities on the long-term benefits of the project and to clarify their concerns.