KUALA LUMPUR: The Mass Rapid Transit Line 3 (MRT 3) Circle Line, which is estimated to cost between RM31bil and RM50bil, will be a boon for the construction sector that has been quiet for the past few years.

       Transport Minister Datuk Seri Dr Wee Ka Siong said the contracts for the MRT 3 project will be dished out in quarter four this year and will see four turnkey contractors involved in the project.

       He said while the project will be monitored by MRT Corp, the government will also open a tender for project management consultant to manage the MRT 3.

       “The tender will be separated into five main packages, including two turnkey contractors for elevated works, one turnkey for underground works, one for integrated systems and a project management consultant to work alongside MRT Corp as the project developer,” he told reporters at a briefing on MRT 3.

       “We plan to open the tender process in May and award the turnkey contracts in the fourth quarter of this year,” he added.

       Wee stressed that the MRT 3 is the critical last piece to complete the Kuala Lumpur urban rail network that will encourage more people to use the public infrastructure.

       The MRT 3, a 50.8km circular alignment covering the perimeter of KL, is slated to be fully operational by 2030.

       The project will consist of 40.1km elevated tracks and 10.7km underground tunnels with 31 stations, of which 10 will be interchange stations with existing rail lines in the Klang Valley.

       Wee said the MRT 3 will integrate with all major rail lines in the Klang Valley – MRT, LRT, Monorail and KTM.

       “MRT 3 will also expand the public transport coverage network in the Klang Valley and will provide access to transit rail for communities that currently do not or have less access to public transport services,” he said.

       In terms of financing the project, Wee pointed out that the government will fund it through sukuk issuances, including for land acquisition.

       “However, we expect the contractors also need to obtain funds for them to take on the construction work,” he added.

       Meanwhile, MRT Corp CEO Datuk Mohd Zarif Hashim said the government has allocated RM50bil to provide enough cashflow for the project, including interest payment for the next 10 years.

       He said the construction of the MRT 3 is estimated to cost RM31bil, and about RM8.4bil has been earmarked for land acquisition and the remaining RM8bil for interest payment.

       Zarif pointed out that the RM31bil construction cost was similar with the MRT 2 line that plies between Sungai Buloh and Putrajaya.

       The construction cost for MRT 1 was RM21bil, while MRT 2 has a price tag of RM31bil in terms of construction cost.

       “The final construction cost is subject to open tenders. On the land acquisition, unlike MRT 1 and MRT 2, MRT 3’s stations are located in the mature area of Kuala Lumpur and therefore the land price is on the high side,” Zarif said.

       The land acquisition will start in the second quarter of this year.

       Zarif noted that the MRT 3 project will also address socio-economic issues including to provide a public transit system to areas that currently lack one, such as Segambut and Setapak.

       A construction analyst said he is optimistic that the approval of the MRT 3 will revive the construction sector.

       “The approval of the MRT3 is a shot in the arm for the construction industry as Malaysia recovers from the economic implications of Covid-19.

       “We are now optimistic about the sector with the impending rollout of MRT 3, which will improve the inflow of jobs including the potential implementation of other projects,” he told StarBiz.

       The construction sector was badly hit by the Covid-19 pandemic as many projects had to stop, except for critical projects, during the movement control order.

       “Prior to this, the sector remained muted for several years, especially since 2018 due to revisions and cancellations of mega infrastructure projects that came with the change of government.

       “There was no catalyst to trigger any meaningful movements until only recently, due to the lack of visibility of the rollout of mega projects and the poor orderbook replenishment that clouded earnings visibility beyond 2023,” an analyst said.