KUALA LUMPUR (Feb 10): Mass Rapid Transit Corporation Sdn Bhd (MRT Corp) has appointed MMC Corp Bhd and GAMUDA BHD [] as the project delivery partner for the Sungai Buloh-Kajang MRT line.
The appointment of MMC Gamuda KVMRT (PDP) Sdn Bhd on Friday as a PDP was to ensure the completion of the MRT line within the agreed key performance indicators (KPI) target cost and set completion date. The target completion date for the entire project is July 31, 2017.
The appointment was also to ensure the MRT project was rolled out efficiently in phases as opposed to appointing a turnkey contractor under a design and build model, according to MRT Corp.
MMC Corp, in a separate statement, said the fee to be paid to MMC Gamuda KVMRT would be equivalent to 6% of the aggregate of all the awarded works contracts (excluding the value of the underground works package if the PDP wins the Swiss Challenge and is awarded the said package).
“In the event that the PDP (MMC Gamuda KVMRT) fails to complete the project by the agreed completion date, the PDP is liable to pay to the owner agreed liquidated damages of RM500,000 per day,” said MMC.
The signatories were MRT Corp chief executive officer Datuk Azhar Abdul Hamid while MMC Gamuda KVMRT was represented by its directors Datuk Hasni Harun and Datuk Azmi Mat Nor. Chief Secretary to the Government of Malaysia, Tan Sri Mohd Sidek Hassan witnessed the signing of the agreements
Azhar pointed out that since the MRT project of such a size and complexity carried with it significant risks such as delays and cost overruns.
“Appointing a turnkey contractor to build the MRT project might prove to be costly should there be any variation in plans or cost. The PDP model will prevent this from happening,” he said.
The PDP’s fee will be 6% of the total aggregate work package contracts award values. However, should the eventual total cost of the project be less than or equal to the target cost, the PDP shall be entitled to the full fee.
If the project cost is more than the target cost, the PDP fee shall be reduced in accordance with an agreed formula.
Azhar said the PDP provided a single point of accountability to deliver the whole project within agreed time and cost targets, and a failure to do so will incur financial penalties.
MMC Gamuda KVMRT would also have to develop the engineering design and technical specifications that met MRT Corp’s requirements and to ensure optimum performance of all other works packages contractors (WPCs) in terms of quality, safety and time.
The MMC Gamuda KVMRT will also be responsible for packaging the works, calling tenders on behalf of the government, evaluating bids, selecting works package contracts with the government and distributing the award to the contractors on the government’s behalf.
MMC Corp said that except for the underground works package, the PDP was not allowed to take part in any of the tender for the works comprised in the project.
The allowed contingency was agreed at 15% of the aggregate of the awarded works packages. Both MRT Corp and MMC Gamuda KVMRT were allowed to utilise the contingency.
“The reimbursables include the PDP’s overheads, fees for engineering consultancy, quantity surveyors and system integration works and fees for site investigations and topographical survey. The amount of the reimbursables is fixed at RM2.85 billion,” it said.
The appointment of MMC Gamuda KVMRT (PDP) Sdn Bhd on Friday as a PDP was to ensure the completion of the MRT line within the agreed key performance indicators (KPI) target cost and set completion date. The target completion date for the entire project is July 31, 2017.
The appointment was also to ensure the MRT project was rolled out efficiently in phases as opposed to appointing a turnkey contractor under a design and build model, according to MRT Corp.
MMC Corp, in a separate statement, said the fee to be paid to MMC Gamuda KVMRT would be equivalent to 6% of the aggregate of all the awarded works contracts (excluding the value of the underground works package if the PDP wins the Swiss Challenge and is awarded the said package).
“In the event that the PDP (MMC Gamuda KVMRT) fails to complete the project by the agreed completion date, the PDP is liable to pay to the owner agreed liquidated damages of RM500,000 per day,” said MMC.
The signatories were MRT Corp chief executive officer Datuk Azhar Abdul Hamid while MMC Gamuda KVMRT was represented by its directors Datuk Hasni Harun and Datuk Azmi Mat Nor. Chief Secretary to the Government of Malaysia, Tan Sri Mohd Sidek Hassan witnessed the signing of the agreements
Azhar pointed out that since the MRT project of such a size and complexity carried with it significant risks such as delays and cost overruns.
“Appointing a turnkey contractor to build the MRT project might prove to be costly should there be any variation in plans or cost. The PDP model will prevent this from happening,” he said.
The PDP’s fee will be 6% of the total aggregate work package contracts award values. However, should the eventual total cost of the project be less than or equal to the target cost, the PDP shall be entitled to the full fee.
If the project cost is more than the target cost, the PDP fee shall be reduced in accordance with an agreed formula.
Azhar said the PDP provided a single point of accountability to deliver the whole project within agreed time and cost targets, and a failure to do so will incur financial penalties.
MMC Gamuda KVMRT would also have to develop the engineering design and technical specifications that met MRT Corp’s requirements and to ensure optimum performance of all other works packages contractors (WPCs) in terms of quality, safety and time.
The MMC Gamuda KVMRT will also be responsible for packaging the works, calling tenders on behalf of the government, evaluating bids, selecting works package contracts with the government and distributing the award to the contractors on the government’s behalf.
MMC Corp said that except for the underground works package, the PDP was not allowed to take part in any of the tender for the works comprised in the project.
The allowed contingency was agreed at 15% of the aggregate of the awarded works packages. Both MRT Corp and MMC Gamuda KVMRT were allowed to utilise the contingency.
“The reimbursables include the PDP’s overheads, fees for engineering consultancy, quantity surveyors and system integration works and fees for site investigations and topographical survey. The amount of the reimbursables is fixed at RM2.85 billion,” it said.
