Light Rail Transit 3 (LRT3) project NOW APPROVED after price reduced by 47% from RM31.65 billion to RM16.63 billion.

Smaller stations, fewer trains see RM15 billion off LRT3 price tag

FMT Reporters | July 12, 2018



Finance Minister Lim Guan Eng says the final cost of RM16.63 billion was approved by the Cabinet yesterday.



The deadline for the LRT3 has been extended from 2020 to 2024 to cut the cost of speeding up the project. (Gambar Bernama)

PETALING JAYA: The government today announced that the cost of the Light Rail Transit 3 (LRT3) project would be reduced by 47% from RM31.65 billion to RM16.63 billion.


Finance Minister Lim Guan Eng said the final figure, approved by the Cabinet in a meeting yesterday, covered all project costs including work package contracts, project management, consultancy fees, operational and overhead costs, and interest during construction.

In a statement, he said a thorough renegotiation and rationalisation exercise had been undertaken by key stakeholders including Prasarana, the Land Public Transportation Commission, and the MRCB-George Kent joint venture (MRCB-GK JV) which was the project delivery partner.

Among the measures agreed on was a reduction in the order of 42 sets of six-car trains to 22 sets of three-car trains.



“Based on the feasibility study of the LRT3 project, the 22 sets of three-car trains are more than sufficient to cope with the anticipated passenger demand until the year 2035, before additional three-car trains need to be ordered,” Lim said.

He said the size and design of LRT stations would also be streamlined based on the Kelana Jaya LRT line instead of the MRT stations which were much bigger.

Likewise, the construction size of the LRT train depot would be reduced given the smaller number of trains to be acquired.

Lim said five stations with very low projected ridership – Lien Hoe, Temasya, Sirim, Bukit Raja and Bandar Botanic – would also be shelved for now, as would an “unnecessary” 2km tunnel for the LRT and an underground station at Persiaran Hishamuddin, Shah Alam.

The government will also extend the deadline for the LRT3 project from 2020 to 2024 to further reduce construction costs which Lim said had been inflated by the expense of speeding up the project.

“In addition, the construction of the LRT3 project will be restructured from a PDP model to a ‘fixed price contract’ with MRCB-GK JV.

“This will ensure that the price will be fixed and will not be subject to cost overruns. The details of this contract will be disclosed at a later stage,” he said.

He added that the RM15 billion savings on the project would also result in additional savings of up to RM14 billion for taxpayers in interest costs over the loan financing period.

On Tuesday, Lim said the government would not support any additional funding request by Prasarana for the LRT3 project unless the cost was significantly rationalised.

He claimed that the cost of development for the 37km line was due to poor management by Prasarana.

“Certain news reports have indicated that the LRT3 cost can be reduced by RM6 billion. The finance ministry wishes to state that much more than RM6 billion must be reduced if the LRT3 project is to proceed,” he said.