Penang Undersea Funeral: The RM4 billion that never existed

TTF: Lim Guan Eng claims that whatever he said prior to October 2013 regarding the Penang Undersea Tunnel is no longer relevant. But as Lim Sian See correctly pointed out, what the Chief Minister said in March and April 2013 was pivotal as it was to counter claims that the Special Purpose Vehicle (SPV) appointed to carry out the RM6.3 billion project was ill-capacitated to do the job.

In other words, when Guan Eng insisted that CRCC was a shareholder, he did so to support claims by the state secretary of Penang that Consortium Zenith BUCG Sdn Bhd (CZBUCG) was “selected (as the SPV) based on the evaluation of the financial and technical strength of the CRCC and BUCG.” 

However, MCA deputy president Wee Ka Siong has since pointed out that CRCC was never a shareholder of the project. Now, I’m positive that if the Chinese construction giant were based in Malaysia, it would have sued Guan Eng to kingdom come for repeatedly claiming it was.

The fact that the company is based in China has allowed the Chief Minister to twist his words ‘kaw kaw’. According to him, the SPV possessed the capacity to carry out the project as CRCC was not just your run-off-the-mill company, but a RM4 billion entity that functioned as the “main contractor.” He was trying to impress upon us that the company had sufficient funds to complete the project without running into problems midway.

Yes, Guan Eng thinks we’re fools.

The only way a company’s paid up capital is deemed a reflection of the SPV’s strength is if that company were to commit all that capital to the SPV. Under the circumstances, CRCC would have to purchase stock worth RM4 billion from Consortium Zenith BUCG Sdn Bhd (CZBUCG) in order for that money to be considered financial backing for the SPV.

But we all know that isn’t the case.

The reason being, we already know with 100% certainty that CRCC was never a shareholder from day one. What this means, is that the company never pumped a single sen into the SPV or committed any portion of its paid-up capital thereto. Thus, there is no point for Guan Eng to keep repeating that the Chinese construction giant is worth RM4 billion or even RM4 godzillion.

However, the Chief Minister needs to tell us how the SPV intends to fulfil its obligations throughout the duration of the project. Can you please do that, Mr Lim Guan Eng?


And please, don’t come and tell me cock and bull stories about how CRCC has so much money, it can afford to complete the entire project without expecting a single sen from the SPV along the way. You’d be a fool to think I believe CRCC only has your projects to worry about.


GEORGE TOWN: Chief Minister Lim Guan Eng has vehemently denied claims by Transport Minister Datuk Seri Liow Tiong Lai that China Railway Construction Corporation Ltd (CRCC) was not a party to the proposed RM6.3 billion cross-channel undersea tunnel project.

Clutching an agreement which he said was legally binding, Lim insisted that the project, which has now turned controversial due to a stand-off between its lead critics – MCA and Gerakan with the state, had listed CRCC as the main contractor.

Lim also played a video clip of the agreement signing in 2013 where CRCC (International) Ltd Zhuo Lei, the under-signatory to the preliminary agreement was captured as saying that CRCC was a top 25 construction company in the world.

Also, Zhuo went on to espouse that the company was a construction specialist especially in areas of tunnelling with an average of 1,300km long tunnels constructed each year in view of the number of global projects that CRCC was involved in.

In a lengthy press conference, Lim exchanged sharp remarks with the media over the project, saying he has issued 10 points to dispute both Liow, who is the MCA president and his deputy Datuk Seri Dr Wee Ka Siong who have criticised the state over the project.

“I hope that Liow and MCA do not try to sabotage the project by causing anxiety to the main contractor (CRCC) and the consortium (Zenith Construction Sdn Bhd) with the Malaysian Anti Corruption Commission (MACC) investigation and false information disclosed to the Barisan Nasional media,” he said.

Lim said firstly Zenith Consortium, who won the open competitive tender to be the project delivery partner has a minimum paid-up capital of RM381 million at the time of the agreement’s signing (in 2013).

He also said that the state government will hold CRCC to their contractual obligations and they will seek legal advice accordingly.

Later, Lim also stated that because of CRCC’s commitment to be the main contractor with a paid up capital of USD$4.5 billion (RM18 billion), the project has continued to receive backing from several companies as well as the consortium.

Source: The Sun



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