Work on LRT3 to start between March and May

KUALA LUMPUR: Prasarana Malaysia Bhd, which aims to hit RM1 billion in revenue this year, will commence work on the Light Rail Transit 3 (LRT3) between March and May this year.
President and Group CEO, Datuk Seri Azmi Abdul Aziz told reporters at a media briefing that bidding is already in progress and tenders will be dished out in stages for the various work packages throughout this year and next year, and the company has already embarked on land acquisition for the project at certain areas.
However, Azmi has declined to divulge contract values of the work packages for the LRT3 line which will be spanning from Bandar Utama to Klang and slated to go into operations in August 2020. He said that the group is giving precedence to the quality and acquiring the best technology that is there to be provided to for longer sustenance rather than focusing on securing the lowest bid.
“We will ensure to look at the best so that the life cycle cost of the components will be taken into consideration as well so that the value will be much better,” he said.
“Contract value is like working on a moving target if trying to stick within the budget,”he said on sticking within the allocated budget of RM 10 billion.
The group will be raising funds to finance the LRT3 project by going into the market and issuing sukuk’s.
Prasarana has committed to complete Phase 1 of the LRT3 project by August 2020, and the completion of the whole project within six to seven months thereafter.
The group is eyeing the RM 1 billion in revenue this year. It is learnt that the group’s revenue for 2016 was close to RM 900 million.
Besides, that it is also looking to increase the non-fare revenue contributions from 15-20% to 30 % against the fare revenue this year, to reduce its reliance on fare revenues to offset operations cost. This also, according to Azmi will prevent regular price hikes.
In a bid to increase its non-fare revenue, Prasarana has ventured into property development such as a 40-storey high rise building above the Dang Wangi LRT station, residential and mixed developments at Jalan Klang Lama and Melawati bus depot. It has also brought in retail outlets, convenience stores and ATM’s into some of its stations.
It is expecting the proceeds of the aforesaid ventures and its overseas engagement, such as operating the Metro Southern Line in Makkah, Saudi Arabia, and technical collaborations with the Bangkok and Jakarta MRT amongst others, to yield more non-fare revenues for the group.
Azmi said, while the groups’s focus lies within Kuala Lumpur in boosting non-fare revenues, as there is land opportunities, take-up and demand if it was to provide the supply.
The group is also targeting an economic return of RM 17 billion in 2017, 21% more than the returns for 2016 which was RM 13.3 billion.
Prasarana is also looking into introducing its Rapid Bus services in more cities in addition to its current routes of Kuala Lumpur, Penang, Kamunting and Kuantan.
On the KL monorail fleet expansion project, Azmi said it is still working with Scomi Engineering Bhd to ensure that they deliver the remaining six trains and complete the RM494 million project.
In July last year, Scomi failed to stop Prasarana from terminating its contract when the court did not extend the interim injunction against Prasarana.
However, the court made an order restraining Prasarana from appointing another contractor until an appeal against the dismissal of its lawsuit is heard. The appeal hearing has been adjourned until Feb 20, 2017.