Ex-PM Najib to be asked to explain two dubious pipeline projects

Former Malaysian prime minister and finance minister Najib Razak will be asked to explain how he could approve dubious contracts of two pipeline projects worth RM9.4 billion (about 75 billion baht)  that jeopardise the interest of the Malaysian people and the government, according to The Straits Times of Malaysia.

Malaysia’s Finance Ministry has discovered that nearly 90 percent of the RM9.4 billion  worth of the contracts were paid out but only 13 percent of the construction work has been completed.

The projects – one multi-product petroleum pipeline running from Melaka and Negeri Sembilan to Kedah, and a gas pipeline from Kimanis to Sandakan and Tawau, all in Sabah – were handled by Suria Energy Resources (SSER), a wholly owned subsidiary of the Finance Ministry.

The projects were awarded to China Petroleum Pipeline Bureau in November 2016.  They were signed by then Treasurer-General Irwan Serigar Abdullah who was also chairman of SSER.

Finance Minister Lim Guan Eng said in a statement issued on Tuesday that he had instructed his officials to file a report with the Malaysian Anti-Corruption Commission.

He said he is calling on former treasury secretar-general Tan Sri Irwan Serigar Abdullah and Mr Najib to explain the deal.

Work on the projects began in April 2017.  By the end of March this year, work on MPP was only 14.5 percent complete but RM 4.7 billion had been paid to contractor CPPB.  The other project, TSGP, was 11.4 precent complete, but RM3.54 billion were paid out.

“We have discovered that the payment schedules for the contracts are based almost entirely on timeline milestones, and not on progressive work completion milestones.  Worse, based on the agreements signed, 85 percent of the project value would be paid by March 1, 2018,” said Mr Lim.

He further noted that the payments did not cover another RM1 billion worth of agreements – two for consultancy services of the projects worth RM312 million and RM213 million and a maintenance contract wirth RM476 million – also awarded to Chinese companies.

Responding to the allegations in Facebook post, Najib said he was confident that all necessary process procedures and laws have been complied with.