AG's report: Works Ministry addresses delays, cost increases in Sabah Pan Borneo project

KUALA LUMPUR: Changes in the implementation method, the Covid-19 pandemic, land acquisition and utility relocation issues, as well as contractor performance have contributed to delays in the Phase 1 Sabah Pan Borneo Highway (LPB) project.

Works Minister Datuk Seri Alexander Nanta Linggi said the termination of the Project Delivery Partner (PDP) model in 2019 also required a new procurement process before 15 Phase 1A contractors were awarded the packages in 2021.

"The project delays were caused, among others, by the change in the implementation method from the Project Delivery Partner (PDP) model to the conventional method.

"The termination of the PDP model in 2019 also necessitated a new procurement process before 15 Phase 1A contractors were awarded the packages in 2021," he said in a Facebook post.

He said the 2026 Auditor-General's Report had identified 13 findings involving project delays, cost increases, weaknesses in planning and non-compliance with regulations and guidelines.

As of Aug 25, only four of the 35 work packages under Phase 1 had been completed, while the remaining 31 were still under implementation.

Nanta said physical progress stood at 89.01 per cent for Phase 1A, 37.58 per cent for WP09 and 23.96 per cent for Phase 1B.

He said the cost increase for Phase 1A was due to the extension of the project period, changes in scope, construction contract prices, as well as unresolved land and utility issues.

However, he said current site readiness had reached 99.79 per cent for Phase 1A, 96.8 per cent for WP09 and 79.43 per cent for Phase 1B.

He said the Works Ministry had also directed relevant officers in the Sabah Public Works Department and the ministry to attend administration and contract management courses with the Construction Industry Development Board (CIDB) and the Public Works Department's Centre for Excellence in Engineering and Technology (CREaTE).

The training was aimed at strengthening their skills in preparing Bills of Quantities, cost determination and contract documentation.

In addition, he said the Sabah LPB Steering Committee, established in November 2024, had continued to strengthen monitoring through its site visit programme.

He said Sabah Chief Minister Datuk Seri Hajiji Noor had also recommended that the committee be co-chaired by the Works Ministry secretary-general and the Sabah state secretary to enhance coordination among state agencies.