Monday, January 30, 2023

Government saved RM11 billion from ECRL project through renegotiations

NewsGovernment saved RM11 billion from ECRL project through renegotiations

The total development cost (TDC) for East Coast Rail Link Project (ECRL) will reduce by RM11 billion from RM85.97 billion to the current cost of RM74.96 billion, said the Ministry of Transport (JPJ).

According to Bernama, JPJ in a statement said the reduction was achieved following the implementation of total value engineering (VM).

“The ministry also stresses that the cost of ECRL 3.0 (current project) construction which is lower was realised thorough a series of negotiations to review the ECRL contract which was finalised in 2019 and 2022,” the statement reads.

Among others were the realignment of the track at Section C involving the Temerloh, Serendah-Port Klang alignment.

Source: Facebook

Earlier, Prime Minister Datuk Seri Anwar Ibrahim said the government would proceed with the ECRL project with cost reduction that will not bring many changes to avoid delaying and complicating works, as well as existing negotiations.

According to the ministry, the original TDC for the ECRL project which was launched in 2017 (ECRL 1.0) amounted to RM85.97 billion encompassing construction cost of RM66.78 billion and other development costs such as (Interest During Construction-IDC), land acquisition, utility transfer and connection fees as well as operating expenses totalling RM19.19 billion.

As for ECRL 3.0, the TDC is estimated at RM74.96 billion, consisting of the much lower construction cost of RM50.27 billion, while other development costs such as interest during construction, land acquisition, transfer of utilities, continuity fees and expenses managed amounted to RM24.69 billion.

The TDC between ECRL 1.0 and ECRL 3.0 results in savings of RM11.01 billion.

Source: Berita Harian

Connecting the east and the west

The ECRL is a railway link that connects the east and west coasts of Peninsular Malaysia and it will dramatically reduce travel time between the two regions.

The 665km rail line from Kota Baru to Port Klang has 20 stations and the Serendah Bypass which facilitates the movement of cargo from the north, as well as a rail extension from Jalan Kastam Station to both the Westport and Northport terminals.

Meanwhile, Transport Minister Anthony Loke said his ministry would not interfere in projects that had already been given letters of award and approval by previous administrations.

“We do not plan to cancel any of the ongoing projects as we recognise that they are vital projects needed for the people,” Loke said.

“Only projects that have not yet been given a letter of award and approval will undergo a re-tender process.”

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