THE Sabah government today welcomed Putrajaya’s decision to cancel the Trans-Sabah Gas Pipeline (TSGP) despite 88% of the project cost already been paid.

Chief Minister Shafie Apdal said the cancellation must have been due to federal government’s financial position.

“Of course, we welcome the decision as we are aware of the financial health of the country and mounting debts.  

“Maybe at this point the project cannot be done. Who knows, the project may be continued when the federal government is financially sound in future,” Shafie told reporters in Semporna, in Sabah’s East Coast.

Shafie who is also the Semporna MP is back at his hometown for the Hari Raya Aidiladha celebrations and tomorrow will host a meet-the-people session.  

Prime Minister Dr Mahathir Mohamad yesterday announced the cancellation of the East Coast Rail Link and two pipeline projects, including the TSGP, awarded to Chinese firms during his official visit to China.

TSGP was approved by the cabinet on July 27, 2016 along with Multi-Product Pipeline, but suspended by the Pakatan Harapan government on July 3 this year.

The suspension came following the discovery that only 13% of the project was completed, and no pipelines have been laid yet despite RM3.5 billion or 88% of the RM4.06 billion total cost had been paid to the contractor.

The two projects worth RM9.4 billion in total had been awarded to China Petroleum Pipeline by the Finance Ministry-owned Suria Strategic Energy Resources Sdn Bhd (SSER).

The TSGP project involved building a 662km gas pipeline from Kimanis Gas Terminal to Sandakan and Tawau was aimed to improve power supply in Sabah’s East Coast districts.

Gas from the West Coast would be transferred through the pipelines to power-up a 300MW gas-powered power plant presently under construction in Sandakan, also in the East Coast of Sabah. – August 22, 2018.