Completion of klia2 delayed further

KUALA LUMPUR: Malaysia Airports Holdings Bhd (MAHB) has indicated that there may be another round of delay in the completion of klia2, which was slated to be opened by June 28, 2013.

In an announcement to Bursa Malaysia yesterday, the airport operator said the contractors involved in the construction of the new hub for low-cost carriers were facing difficulties in meeting the deadline.

“We are of the view that the contractors for klia2 may have difficulty in meeting the June 28, 2013 deadline, despite the commitment given by them.

MAHB will be meeting the contractors again soon to confirm whether or not they are able to meet the deadline. Any further updates will be announced accordingly,” it said.

The announcement comes as no surprise considering that analysts had earlier cautioned it was unlikely that MAHB would be able to meet its June deadline.

“During its first quarterly results briefing, MAHB chose not to commit on whether the new klia2 will open as scheduled on June 28, and whether the cost will exceed RM4 billion.

“Our base case now assumes that klia2 will only start operations in January 2014, and total construction costs will rise to RM4.5 billion,” said CIMB Research in a recent report.

The airport project was tendered out in 2009, with the original date of completion being September 2011. The completion, however, had been delayed several times and the estimated cost of the project had also escalated from its initial budget of RM1.9 billion to RM4 billion last year.

It was reported in March that the construction of klia2 had already surpassed the 80% completion mark.
MAHB closed 1.75% or 11 sen higher yesterday at RM6.41.