LUMUT: The Defence Ministry is satisfied with the latest status of the littoral combat ship (LCS) project and confident that the first ship will be delivered next year.
Its minister Datuk Seri Mohamad Hasan, during a visit to the Royal Malaysian Navy (RMN) base today said all the ships are being built by Boustead Naval Shipyard Sdn Bhd (BNS), with completion rate of between 22 to 70 per cent.
"For three years, this project has been put on hold due to cash flow problems.
"Boustead tried its very best to secure financing from outside but the government has to do something to ensure continuation of the project," he said after the visit.
Also present were the Defence Ministry secretary general Datuk Seri Muez Abd Aziz and RMN chief Admiral Tan Sri Mohd Reza Mohd Sany.
When listing out the construction status of the six ships, he said the first ship is 70 per cent completed, followed by the second ship at 48 per cent, the third ship (44 per cent), the fourth ship (37 per cent), the fifth ship (22 per cent), while the construction of the sixth ship has yet to begin.
Following this, Mohamad said he was confident that the first ship would be delivered to the RMN by next year.
"The first ship, which has reached 70 per cent completion, has been installed with four engines as well as a gearbox.
"The electronics and weapon systems will be installed and this will take some time. I am happy to see the progress and I believe the first ship will be completed by 2024.
"For the other three ships, it will take about two to three years to complete and we hope this project will be completed after being abandoned for over three years," he said.
Asked whether the ministry has removed the middlemen involved in the LCS project to reduce the cost, Mohamad said the matter was at the final stage.
"It is at the final stage, for us to pay an outstanding payment that we owe them and they agreed that there will be no more middlemen.
"That needs to be settled and I don't think we have a problem with that. We will go straight to the vendors to negotiate," he added.
The LCS project is the largest acquisition in the history of the Defence Ministry, with an overall value of RM9 billion. The contract began in 2013 and was projected to end in 10 years.
The PAC, in its report on Aug 4, last year said the government had paid RM6.083 billion to BNS, in a deal that was signed via direct negotiation, but not a single vessel has been delivered.
Based on the original schedule, five of the six LCS vessels should have been completed and handed over by Aug last year.