Penang undersea tunnel is still alive, says Consortium Zenith

Its chairman says the state govt remains committed to developing the undersea tunnel


Construction of the proposed RM3.5 billion undersea tunnel linking Penang and the mainland is still on the cards, despite speculation that a third bridge would force state authorities to scrap the ambitious plan.

Consortium Zenith Construction Sdn Bhd chairman Datuk Zarul Ahmad Mohd Zulkifli said the state government remains committed to developing the undersea tunnel, which is expected to link Persiaran Gurney on the island to Bagan Ajam on the mainland.

“We are on track for development and currently waiting for the DEIA (detailed environmental impact assessment) approval which we hope to get soon,” he told The Malaysian Reserve.

He said Consortium Zenith will continue to work towards the project’s development based on the existing directive from the state government, ignoring “the noises from external forces”.

“My contract with the state government is for the undersea tunnel and I will proceed unless the state decides otherwise,” said Zarul Ahmad.

Speculations were rife on the future of the long-delayed undersea tunnel project if the federal government decides to grant Penang a third bridge linking the island and the mainland.

Observers are also concerned on the recent reversal of Consortium Zenith’s land sale to Ewein Bhd, claiming that it underlines the uncertainty related to the project.

The entire undersea tunnel and three expressways project were slated for completion by 2021.

On the scrapped deal with Ewein, Zarul Ahmad said that it has not dampened Consortium Zenith’s progress of the mega project.

To recap, Ewein’s subsidiary, Ewein Zenith II Sdn Bhd, inked a deal in December 2015 to purchase 1.79ha from the 44.5-ha of freehold reclaimed land in Tanjung Pinang, to be received by Consortium Zenith for undertaking the Penang mega project for RM162 million.

In January 2016, Ewein’s 60%-owned property development unit Ewein Zenith Sdn Bhd inked an agreement with Consortium Zenith to grant the former the right to buy three parcels of land totalling 20.23ha at Tanjung Pinang at RM1,300 per sq ft.

Zarul Ahmad said Consortium Zenith has secured a buyer for a two-acre (0.8ha) land in the form of Zenith Urban Development Sdn Bhd — a joint venture between Consortium Zenith (30%) and Wira Syukur Sdn Bhd (70%).

Wira Syukur is a Selangor-based property developer with three ongoing projects in Selangor, and one each in Kelantan and Sabah respectively.

A consortium of Consortium Zenith, China Railway Construction Co Ltd and Beijing Urban Construction Group Co Ltd was selected as the contractor to undertake the mega project covering a 6.5km undersea tunnel and three expressways in 2013.

The consortium comprised companies having a combined paid-up capital of RM4.5 billion when it came together that year.

However, the Penang state government removed the Chinese state-run firm as partner in the consortium last year, after it was found responsible for the recent fatal crane hook collapse incident in Kuala Lumpur.

The three highways, known as paired-roads, have a combined length of 21.2km.

The first highway connects Air Itam to the Tun Dr Lim Chong Eu Expressway, while the second highway from Tanjung Bungah to Teluk Bahang would start upon completion of the first highway.

The construction of the third highway, from Gurney Drive to the Tun Dr Lim Chong Eu Expressway, would commence after the first two highways are completed.

Last month, fashion apparel retailer Voir Holdings Bhd proposed to diversify into areas such as construction and property development by taking a 13.21% equity interest in Consortium Zenith.

Zarul Ahmad is also Voir’s chairman and substantial shareholder (with a 43.4% stake).