Kuala lumpur: A total of RM1.2 billion has been disbursed by the federal government as land compensation for the Sabah Pan Borneo Highway (PBH) Phase 1 Project to date, according to Deputy Minister of Works Datuk Seri Ahmad Maslan.

According to BERNAMA News Agency, the land compensation for the Sarawak segment of the PBH has amounted to RM737 million. Ahmad emphasized that the government is absorbing all costs associated with compensation, losses, and administrative expenses to prevent landowners from incurring losses.

This announcement was made in response to a query by Isnaraissah Munirah Majilis (WARISAN-Kota Belud) concerning the increased cost of the Sabah PBH Phase 1 Project, which has escalated to RM24.889 billion from an initial estimate in 2015. The question also covered the specifics of land compensation during an oral question and answer session in the Dewan Rakyat.

Ahmad explained that the project's cost surged from the initial estimate of RM12.86 billion in 2015 to RM24.889 billion due to a transition to the Federal Conventional Contractor method. This shift followed the termination of the Project Delivery Partner (PDP) model in 2019 for reasons tied to national interest, necessitating a reassessment of the project's scope and remaining work after a five-year interval from the original assessment.

From a technical perspective, the increase in project costs stemmed from factors such as changes in scope and design, geotechnical structures, soil treatment, and extensive utility relocation works. The cost of Phase 1A comprised 16 work packages totaling RM10.9 billion, while Phase 1B encompassed 19 work packages at a cost of RM13.989 billion.

Ahmad noted that beyond technical causes, the cost escalation was also driven by inflation and the rising prices of key construction materials like iron, bitumen, and cement, alongside increased machinery and labor costs.