KUALA LUMPUR (June 10): Malaysia Rail Link Sdn Bhd (MRL), the project and asset owner of the 688-km East Coast Rail Link project, has denied that there was any contract term between it and the ECRL's Chinese contractor regarding the purchase of two companies linked to businessman Jho Low for US$315 million.

In a statement issued today in response to The Edge Malaysia's cover story headlined 'Jho Low's Handiwork' for the week of June 11-June 17, MRL said the publication had made "a baseless and irresponsible allegation" about how the ECRL contractor, China Communications Construction Company Ltd (CCCC), had been required to nominate a company unrelated to it to buy 70% of Putrajaya Perdana Bhd for US$244 million, and 90% of Loh & Loh Corp Bhd for US$71 million.

"Allow us to clarify that this information is completely incorrect and misleading. It is a baseless and irresponsible allegation. 

"There is no contract between China Communications Construction Company Ltd (CCCC) and MRL that stipulates this clause. Neither does this clause appear in the loan agreement between MRL and the Export-Import Bank of China," said MRL.

The inaccurate information, it went on to say, "potentially ruins the reputation of MRL and its cordial relationship with CCCC, the main contractor of the project". 

"As such, MRL urges the media to engage with its Corporate Communications Department to verify information with regards to the ECRL project," it added.

According to MRL, which was incorporated on Sept 26, 2016, the realisation of the ECRL project was done based on a government-to-government agreement. It also said that only the engineering, procurement, construction and commissioning contract with CCCC and the loan agreement with the Export-Import Bank of China is within its purview with regards to the ECRL project.

"To date the ECRL has made 14.33% in the overall progress of its construction which includes setting up of base and satellite camps in all eight sections of the project, land acquisition, site clearing and construction of road access," it updated, adding construction works for seven tunnels in various parts of the rail alignment in Pahang and Terengganu have commenced. 

While the ECRL is progressing slightly ahead of schedule and is on track for completion and operation by mid-2024, its fate now hangs in the balance as the government is reviewing the project, which it seeks to renegotiate with China.  

Prime Minister Tun Dr Mahathir Mohamad has also said the government may defer or terminate the deal because the country cannot afford it. 

If built, the rail link would connect Port Klang in Selangor and Pengkalan Kubor in Kelantan.