The contract is valued at about RM99.2mil per year, excluding any additional works. The duration of the contract is from Jan 1 to Dec 31, 2029.
PPES Works is 51%-owned by CMS Works Sdn Bhd, which in turn is a wholly-owned subsidiary of CMS. The remaining 49% equity interest is held by Sarawak State Economic Development Corp.
Under the letter of acceptance signed with the Sarawak government last Friday, CMS said the contract secured by PPES Works is for package one that involves the management and maintenance of state roads in Kuching, Serian, Samarahan, Kapit, Sibu and Sarikei divisions.
“The scope of works is to undertake planning, organising, directing and controlling of the management and maintenance of contract state roads, which include preparation of annual work programme and budget, to carry out annual road condition survey, performing the routine and periodic maintenance to undertake instructed works and emergency works in accordance with JKR sarawak road maintenance and management system requirements,” said CMS.
The company said the risks associated with the contract are escalation of rates for labour, equipment and material within the first three years if the government insists to have the first negotiation only after the next three years.
In its 2018 annual report, CMS said the group is responsible for the maintenance of 6,260km of state roads throughout Sarawak.
Commenting on the reduction in contract for CMS, group managing director Datuk Issac Lugun said the company still maintains the lion’s share of the contract.
“We have always maintained that we are not a monopoly and this prove it. We applaud the state for its move because competition in any market naturally breeds efficiency. This can only be good for the public and the roadusers.”
Lugun said CMS had done its part in laying the foundations of Sarawak’s existing roads.
“Intra-state connectivity will be the arteries of socio-economic growth and the Sarawak state government had a massive infrastructure plan that will see statewide road connectivity becoming a priority as we head towards our state’s 2030 goals.
“We believe that we are best-positioned to facilitate and make the connectivity plan a reality,” he pointed out.
The Sarawak government is currently funding two major billion-ringgit road projects – the Sarawak coastal road network and Sarawak second trunk road – to connect more rural villages with major towns.
The state’s most ambitious road project, the RM16bil Sarawak Pan Borneo Highway project funded by the federal government, is now close to 45% completion.
Works Minister Baru Bian announced recently that a Sarawak-Sabah link road, estimated to cost RM5.2bil, would be built.
Tender for the project’s package one has opened for bidding.
Last month, the Sarawak government also announced the construction of a border security road project to link up to Kalimantan, Indonesia.
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