(Petaling Jaya, Saturday): Recent market talks about financial problems in connection with the RM13.6 billion Bakun hydroelectric dam project have been reinforced by the Asian Wall Street Journal report yesterday that the Deputy Prime Minister and Finance Minister Minister, Datuk Seri Anwar Ibrahim, had rejected a request by Ekran’s controlling shareholder, Tan Sri Ting Pek Khiing, that the government guarantee a one-billion-ringgit interim credit facility to Bakun’s promoters.
The Asian Wall Street Journal report said:
“Kuala Lumpur - Promoters of the massive Bakun hydroelectric dam, led by construction giant Ekran Bhd., have turned to the Malaysian government for help clearing a financial hurdle facing the 15-billion ringgit project. But the aid Kuala Lumpur is offering falls short of what the dam’s backers are seeking.
“Senior government officials say Finance Minister Datuk Seri Anwar Ibrahim rejected a request this week by Ekran’s controlling shareholder, Tan Sri Ting Pek Khiing, that Kuala Lumpur guarantee a one-billion-ringgit interim credit facility to Bakun’s promoters. The money would go to meet payments to the builders of the dam, a consortium led by Swiss-Swedish construction company Asea Brown Boveri Ltd. The funds are aimed at tiding Ekran and its partners over until June, when they expect to raise financing for the project through the public listing of Bakun Hydro-Electric Corp. Sdn. Bhd. or BHEC, the main operating company for the project.
“Instead, government officials say that Datuk Anwar has agreed to provide only a ‘letter of comfort’ to the bankers of Bakun’s promoters, which will enable Ekran and its partners to raise 500 million ringgit in bank loans. A letter of comfort confirms the government’s support for a project, but doesn’t commit the state to repay debts.
“The government officials also say that the letter of comfort will expire immediately after BHEC is listed. Ekran had requested that the government backing run for the entire 30-year concession period under which BHEC is to supply electricity generated by the dam to the national power company, Tenaga Nasional Bhd.”
Datuk Seri Anwar Ibrahim should explain the financial problems of the Bakun dam project during the winding-up of the motion of thanks on the Royal Address on Monday, and why the Government has to issue a Letter of Comfort when Bakun is a privatised project, and whether these events indicate that there is a lack of public confidence in the future of the Bakun dam project.
A parliamentary explanation by the Deputy Prime Minister on Monday is most apt and appropriate as the Bakun dam project had been the subject of controversy, not only about its environmental impact and technical feasibility, but also its financial viability.
A parliamentary accounting has become even more pressing with the threat by Ting Pek Khiing to sue freelance correspondent, MGG Pillai, for RM13.6 billion as damages for posting on the Internet newsgroups under the heading “Is there a problem over the Bakun dam”, which had alleged among other things that work on the Bakun site had stopped, that several experts had left and payments had not been made.
If Parliament is not given an explanation about the financial position and problems of the Bakun dam project during the winding-up of the debate on the Royal Address on Monday and Tuesday, the DAP will bring up the issue for Parliamentary debate during the current meeting.
(5/4/97)