2nd Penang bridge deal has variable cost clause

The building cost of the second Penang bridge is expected to be higher than the estimated RM4.3bil, as the agreement includes a variable cost clause which accounts for possible increase in building material prices.

According to UEM World Bhd chairman Tan Sri Ahmad Tajuddin Ali, the RM4.3bil price tag was based on building material prices as at end-December 2007 and included the cost of land acquisition and design.

Since January, international prices of steel and cement have escalated close to 50%. Locally, the Government has also liberalised both the sectors by removing the ceiling prices of certain-related products.

[via TheStar.]