There was an urgent need for the Low-Cost Carrier Terminal (LCCT) in Sepang and that was the reason for the RM108 million project to be awarded through a direct negotiation rather than open tender process, the parliament was told today.

Transport Minister Ong Tee Keat also revealed that the project would have cost RM123 million plus futher delays if it had gone through an open tender.

visit malaysia year 2007 promotion 181206 lcct at night Ong was responding to a question by Wee Choo Keong (DAP-Wangsa Maju) who wanted to know why the government had spent RM108 million to build the LCCT for non-frill airlines AirAsia when the Kuala Lumpur International Airport was still under-utilised.

Wee also said that there was something fishy with the awarding of the contract through a direct negotiation, claiming that there was a middleman who had profitted from the project.

Wee even named the middleman and the his company for their role in the project.

Ong disputed these claims, adding that Wee had every right to bring the matter to court if he could prove his allegations.

In his supplementary question, Wee again expressed his concern over the hefty cost of the project.

"Why did the government spend RM108 million to build the LCCT which is structured only by iron-steel?" Wee asked.

Ong responded by saying that although the builder had no experience in building terminals, it however was experienced in building cargo terminals. He added that the government also has a long-term plan to renovate the existing LCCT into a cargo complex.

"If you look closer at the LCCT, it looks like a cargo terminal and the builder has experience in that. The government also plans to build a new LCCT complex on a different site in KLIA", Ong said.

'Something is amiss'

ong tee keat pkfz klang visit 060508 09 On the high cost of the terminal, Ong ( photo ) said the cost should be seen in context in terms of its size, capacity and specificity to make sense.

When met later in the parliament lobby, Wee said that he was not satisfied with Ong's answers.

"Something is amiss, why would they need a middleman for direct negotiation?" asked Wee.

Ong also revealed that the government has also decided to upgrade the existing LCCT to smoothen out the increase in passenger traffic of 10 to 15 million per year and to accommodate the growth of LCC flights.

"The new LCCT is expected to accommodate the traffic until 2012 or 2015 depending on the annual traffic growth." Ong added.

LCCT is now accommodating other low-cost airlines besides AirAsia and AirAsia-X, such as AirAsia Thailand, AirAsia Indonesia, Cebu Pacific and Tiger Airways.