Extracted from Malaysiakini

GLC Sime Darby may take over troubled Bakun dam

Dec 17, 06 9:57am

The government has agreed in principle that conglomerate Sime Darby can take ownership of the controversial Bakun hydroelectric power plant in Sarawak.

Citing unnamed sources, the Edge financial weekly said Sime Darby already headed a consortium awarded a contract in 2002 to help build a massive dam as part of the project, whose completion has been delayed by years.

"Sime is seen as the best candidate to own Bakun because it will resolve the funding issue and settle all claims and counter claims that have come out of the project," said a source.

The dam project on Borneo island has been dogged by delays and setbacks since its approval in 1993.

Work on the dam has been slow because of unresolved matters such as cost overruns, already at RM700 million, the Edge said.

It had been slated to be completed by August 2007, but the weekly said the first turbine was scheduled to start operation only in August 2009.

Undersea cables link revived

The government-linked Sime Darby, which also has interests in the property and plantation sectors, could become one of Malaysia's largest independent power producers if allowed to own the Bakun project, the report said.

The dam, which involves flooding an area the size of Singapore, has attracted fierce criticism because of its impact on the environment and the fact that 10,000 residents have already had to evacuate the project site.

The Edge also reported the government had approved an ambitious 2.5-billion-dollar project to link the Bakun power station to peninsular Malaysia using undersea cables.

It said Sime may take the lead role in a consortium undertaking the project, which was dropped following the 1997 Asian financial crisis.

Energy minister Lim Keng Yaik last month said the government may revisit the proposal.

- AFP