Dr M: Malaysia has the right to reclaim money from CPP

  • Nation
  • Monday, 15 Jul 2019

PUTRAJAYA: Malaysia has the right to reclaim money from China Petroleum Pipeline Engineering Ltd (CPP), as the company was paid more than the work completed for two pipeline projects, says Tun Dr Mahathir Mohamad.

The Prime Minister said the RM1bil that was seized from the company was because it had not carried out work as per payment.

"The company had been paid 80% of the project cost, whereas work completed was only 13%.

"Since the projects were cancelled, we have the right to get back money for parts that were not implemented," said Dr Mahathir after chairing a Bersatu supreme council meeting on Monday (June 15).

Last Saturday (July 13), it was reported that the authorities seized more than RM1bil (US$243.25mil) from a HSBC bank account belonging to CPP.

The seizure came nearly a year after authorities suspended two pipeline projects, valued at US$2.3bil (RM9.45bil), for which CPP was the lead contractor.

Singapore's Straits Times, in quoting sources, said that the Pakatan Harapan government had ordered HSBC to transfer the funds held in CPP's account to Suria Strategic Energy Resources, which is wholly owned by the Finance Ministry.

CPP said it was perplexed by the unilateral transfer of funds out of its account without notification, while HSBC had declined to comment on the matter, citing client confidentiality.

Earlier, Finance Minister Lim Guan Eng said the ministry did not issue any instructions to seize more than RM1bil in funds from CPP.

“I would just like to say that neither the Finance Ministry nor I issued any instructions for the seizure.

“So, if there are any instructions of seizure, you should refer to the enforcement agencies. That’s all I want to say,” said the Finance Minister, without elaborating further.

Lim was speaking to reporters at the Parliament lobby on Monday.

In 2016, CPP won a contract from the government of former prime minister Datuk Seri Najib Razak to build a petroleum pipeline stretching 600km along the west coast of Peninsular Malaysia and a 662km gas pipeline in Sabah.

But the projects were suspended last July by Dr Mahathir. The Prime Minister had vowed to renegotiate or cancel what he calls "unfair" Chinese projects authorised by Najib, according to Reuters.

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