According to the State Public Works and Utilities Executive Councillor Lim Hock Seng, Penang’s upcoming undersea tunnel and three paired roads are expected to cost a total of RM6.3 billion only.
He was refuting the allegation made by Urban Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan that the overall cost of the mega infrastructure project could reach RM20 billion.
Lim also pointed out that the RM305 million budget for a feasibility study is fair. “The costs are reasonable if compared to the scale of fees of local and international professional bodies.”
Penang Undersea Tunnel To Cost RM6.3 Billion Click To Tweet“The RM305 million is not only for a feasibility study but also for the project’s detailed design and environmental impact studies, and this sum is only 5.54 percent of the total construction costs,” he told reporters.
Out of the RM6.3 billion, RM5.5 billion is for construction costs and RM540 million is for the land acquisition, while RM503 million is for a feasibility study, detailed design, and environmental impact studies.
Of the RM503 million, the feasibility study for the three paired roads merely costs RM31.269 million, whereas that for the undersea tunnel is at RM20 million. The combined figure only represents 0.93 percent of the overall project cost.
The feasibility studies for the three paired roads and the undersea tunnel are expected to be completed by July, then the appointed firm will start making the detailed designs.
Meanwhile, the state government plans to pay the builder Consortium Zenith-BUCG with 110 acres of reclaimed land, but Abdul Rahman claimed that the land was undervalued the land as its market price could double or triple by 2025 when the project is completed.
On this, Lim said the state government had already taken into account future prices as the land to be reclaimed was priced at RM457 per square feet (psf) by the Valuation and Property Management Department in 2014.
“The 110 acres land to fund the project that costs RM6.341 billion means the land value is at RM1,300 psf so it is already triple the value.”
Moreover, the 30-year toll concession to be granted to the builder comes with a condition that the company will manage and maintain the undersea tunnel.
“The state government could not bear the costs of maintaining the tunnel and does not have expertise in such matters but let me stress that only the tunnel has toll but the three paired roads are toll-free” he added.
–PROPERTYGURU