MRT SBK tunnelling churns RM4.8B contracts for SMEs

Trainees: Upon graduating from Gamuda’s Tunnelling Training Academy, these young men have taken on significant roles that allowed them to be part of the construction industry, while securing their own future.

THE tunnelling or underground works of the country’s first mass rapid transit (MRT) from Sungai Buloh to Kajang has not only set a milestone in the construction technology landscape but has also created a whole new ecosystem for small and medium enterprises (SMEs) to be involved and gain valuable experience in this multi-billion ringgit project.

The Sungai Buloh-Kajang MRT (SBK Line) will be fully operational by July 17 and is estimated to have a daily ridership of 400,000. The Gamuda Bhd and MMC Corp Bhd joint venture, the main contractor of the RM8.2bil tunnelling job, has been a catalyst for higher local content in this project and has nurtured a robust SME ecosystem for the construction industry.

The length of the SBK Line underground portion is around 9.5 km with seven stations. The total length of the SBK Line is 51 km with 31 stations.

According to Gamuda Engineering managing director Datuk Ubull Din Om, out of the total underground contracts, around RM4.8bil jobs were awarded to 633 SMEs.

Ubull: ‘Demand for services of the SMEs involved in the SBK Line is set to continue given that more rail projects are being planned for the country.’

Ubull: ‘Demand for services of the SMEs involved in the SBK Line is set to continue given that more rail projects are being planned for the country.’

“So, I would say the benefit to locals is huge in terms of upskilling as well as exposure to new foreign technology and knowhow.

“For example, we are the first in Malaysia to use reinforced steel fibre in the tunnelling segment, instead of using steel bars.

“This is a new technology that involves technology transfers from other countries. And we also did a lot of research and development activities in the early stage.

“This is in line with the Construction Industry Transformation Programme (CITP) by the Works Ministry to increase industrial productivity under the P6 Advance SME/bumiputra capacity and capability building,” he says.

In the construction sector, SMEs are mainly in the special trades sub-sector, constituting about 40% of total establishments in the sector. Special trades refer to the construction of parts of buildings and civil engineering works without responsibility for the entire project.

The contracts for SMEs in this sector are well distributed across medium, small and micro enterprises.

Main contractor: The MMC Gamuda joint venture is the main contractor for the RM8.2bil tunnelling job for the SBK Line.

Main contractor: The MMC Gamuda joint venture is the main contractor for the RM8.2bil tunnelling job for the SBK Line.

Of the total underground and tunnelling contracts awarded in both the SBK Line and MRT Line 2, which is the Sungai Buloh-Serdang-Putrajaya Line (SSP), 98% are awarded to Malaysian companies.

Some of the local contracts in the MRT project involve grouting and building protection, structural works, construction materials, instrumentation and monitoring works, excavation works, architectural works, site facilities, security and traffic diversion and utilities relocation.

Foreign contracts were given for design and consultancy works utilising tunnel boring machines and tunnel related equipment and consumable items.

Ubull believes the nurturing of SMEs involved in this SBK Line is timely and the demand for their services would continue with the booming of rail projects in Malaysia such as the SSP Line (for which MMC Gamuda is the underground contractor), East Coast Rail Line (ECRL) and High Speed Rail between Kuala Lumpur and Singapore.

“We are trying very hard to bring more SMEs into the SSP Line as the underground alignment is longer at 13.5 km with 11 underground stations.

“As of Q1 2017, the contract value for SMEs in the SSP underground portion has already reached RM6.7bil involving 347 companies and awards are still ongoing,” says Ubull.

Of the total underground and tunnelling contracts awarded in the SBK and SSP lines, 98% are awarded to Malaysian companies.

As a comparison between SBK and SSP lines, additional contracts were added in the SSP Line such as support for GFRP and coupler.

More participation in SMEs is extended as the underground alignment in SSP Line is longer with more underground stations.

“It is vital to ensure continuity of local participation in infrastructure projects.

“This will enable SMEs to invest in upskilling and multi-skilling, with improvement in technology in equipment and automation,” says Ubull

What the SMEs say

One of the SMEs involved in the MRT project is Zumatex Engineering Sdn Bhd which has invested RM10mil in its equipment for gas relocation works since working on the SBK Line.

“We have managed to move up the value chain from a company established in year 2001 to where we are now in the range of a large enterprise thanks to the MRT project,” says its director Mayamas Omar.

“Participating in public transportation projects such as the MRT has brought much innovation and progress for many SMEs like Worktime Engineering.

“Being involved in relocation works of power supply cables for KL Sentral, Pasar Seni, Stadium Merdeka, Bukit Bintang (in SBK Line), Hospital KL and Kampung Baru North (in SSP Line) – has presented us with the unique opportunity to be on a national project.

“We are able to improve our technology and knowledge that directly moves us ahead of the competition in the long run” says Worktime Engineering Sdn Bhd director Affendy Arifin.

Meanwhile another company, Huls Transmission, is glad to be part of a infrastructure project like the MRT.

“From relocating power supply cables at Maluri in SBK Line and now at KLCC East in SSP Line for a contract value of RM8mil, we get to expand our skill sets and technology,” says its director Asmalina Mohd Napiah.

Challenges & sustainability

On challenges, Ubull says it revolves around talent as MRT construction is a new business and wider spectrum than the normal civil works

“That’s why we have to do a lot training via MMC Gamuda’s Tunnelling Training Academy (TTA),” he says.

Just last month another batch of 100 TTA students has just graduated and they will become part of the 1,000-strong workforce in SSP Line.

The academy had initially produced more than 1,000 graduates for the SBK Line project.

TTA now upskilling another 1,000 youths for work on the second line.

Graduates from TTA would be assured employment, and provided with accommodation and food allowance.

The goal of TTA was to upskill local youths to become skilled tunnellers working with tunnel-boring machine technology both for local and foreign projects.

“We will eventually have local talents in the field to help reduce dependence on foreign labour,” says Ubull adding that this augured well in helping develop the country’s human capital and achieving a high-income nation by 2020.

TTA was set up at a cost of RM10mil in 2011 with MMC Gamuda spending RM2mil annually to operate the academy and upskill students who are selected from the National Youth Training Institute and community colleges.

In SSP Line, Ubull says it is a blessing for MMC Gamuda to have in its possession 10 tunnel boring machines from the SBK Line tunnelling works, to take on the next tunnelling job without any capital outflow.

In 2011, MMC Gamuda invested in several Tunnel Boring Machines for SBK Line Underground works. The machines which consist of advanced technology tunnel borers from Germany, have appreciated in value now.

MMC Gamuda invested not just in the technology but also in the required human capital to support the operations of tunnel boring machines, both of which will help in huge savings in currency exchange.

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