The chairperson of Zenith Group of Companies, Zarul Ahmad, said he would be informing the company’s board of directors over allegations made by BN strategic director Abdul Rahman Dahlan related to the three highway projects and undersea bed tunnel linking the Penang island to Butterworth.

Zarul, who heads Consortium Zenith-BUCG which was awarded the contract to develop the projects, said the directors would be consulted on what “line of action” to be taken on Abdul Rahman’s claims.

“I know Rahman Dahlan, he has my (phone) number, and I am ready to give him a presentation on the project if he asks,” Zarul said at a press conference held together with Penang executive councillor Lim Hock Seng in George Town today.

Asked if he were mulling legal action against Abdul Rahman, Zarul declined to respond.

He was responding to Abdul Rahman’s remarks on May 6, where the federal minister urged the Penang government to explain how a feasibility study for the proposed Penang undersea tunnel can cost as much as RM305 million.

Today, Lim explained that the cost of the feasibility study for the three highway projects only cost RM51.2 million, while the study for the undersea bed tunnel costs only RM20 million, and not RM305 million.

Other than the two feasibility studies, RM305 million will pay for the detailed designs of the projects, Lim added.

Consortium Zenith will bear the cost of an additional RM4.9 million for enviromental impact assessment and detailed environmental impact assessment.

Abdul Rahman also claimed that Consortium Zenith BUCG has a majority share in the first sub-contractor appointed by the consortium – Astral Supreme Construction Sdn Bhd – a company which failed to deliver on the same reports when it was contracted to do so earlier.

Zarul denied that Consortium Zenith had majority shares in Astral, saying the agreement with the company has been cancelled.

“Consortium Zenith never missed any deadlines, and we have continued to do our work according to the agreement signed with the Penang government to carry out the projects,” he said when asked about Astral.

Abdul Rahman also asked if the feasibility study has been awarded via an open tender to Consortium Zenith.

Lim replied that the project was awarded to Consortium Zenith via a “request for proposal (RFP)”.

He said that pre-qualification for the RFP was publicly made and advertised through the media and the state government website on Nov 15, 2011.

He added that two briefings for the pre-qualification were attended by 60 companies – 43 local and 17 international.

“A total of 11 companies submitted their offer for the pre-qualification, and of these, eight were shortlisted for the RFP,” Lim said.

“On July 6, 2012, all eight companies were called to take part in the RFP, which was closed on Oct 15 that year,” he added.

Best offer

Following this, a technical and financial committee chaired by the state financial officer was formed to evaluate and notify the state tender board about the best offer among the companies, Lim said.

The company with the best offer must also be able to comply with all the technical requirements and RFP conditions, he added.

“The lowest offer was from Consortium Zenith which fulfilled all the criteria of the RFP,” Lim said.

He added that under the initial contract, Consortium Zenith was asked to appoint consultants to perform the feasibility study and detailed design.

He said the agreement also stated that independent consultants for the environmental impact studies would be appointed by the Penang government.

“The cost for the independent consultants will be paid by Consortium Zenith, the agreement states,” Lim said.

He added that Consortium Zenith has completed the studies according to the schedule stated in the agreement.

“At the moment, the EIA is being carried out by independent consultants who were appointed by the Penang government,” Lim added.

“If Consortium Zenith fails to carry out the studies according to the agreed schedule, the Penang government has the right not to pay the company,” Lim said.

“However, this will not happen as the company has completed its work according to schedule,” he added.

On why the Penang government has to give the company a 30-year toll concession, Lim said it was for the operation, restoration, and management of the undersea bed tunnel.

He said this cost could not be borne by the state government as it also did not have the expertise to manage the tunnel.

“Consortium Zenith will bear the responsibility of the daily traffic flow on the tunnel; the Penang government does not guarantee this,” Lim said.