KUALA LUMPUR (March 3): Scomi Engineering Bhd and Prasarana Malaysia Bhd have mutually agreed to drop their lawsuits against each other over a contractual disagreement, and signed a new agreement today that will allow Scomi Engineering to complete the construction of a new depot for the Kuala Lumpur Monorail fleet expansion.

Under the new agreement, Scomi Engineering will also be delivering 12 sets of new four-car trains to Prasarana for the project.

In a statement, Scomi Engineering said this new agreement is a third supplemental contract to a primary agreement that was signed between the two parties in 2011, and is to facilitate the completion of the remaining works agreed under the principal deal, i.e. the delivery of the remaining six sets of the dozen four-car trains.
 
“With the signing of this third supplemental contract, both parties have agreed to retract their respective law suits filed previously. Additionally, under this third supplemental contract, both parties have agreed to appoint an independent consultant to resolve all claim issues,” Scomi Engineering said.
 
“We are pleased to move forward and continue with this project after various negotiations with Prasarana. With the common goal of ensuring completion of this project, my team and I remain committed to delivering our responsibilities for this important project which is of national interest,” said Scomi Engineering chief executive officer Rohaida Ali Badaruddin.

The new agreement with Prasarana was inked via Scomi Engineering's wholly-owned unit, Scomi Transit Projects Sdn Bhd (STP).  
 
Last June, Scomi Engineering dragged Prasarana to the High Court after Prasarana warned it would terminate its contract over alleged dissatisfaction with its work.
 
To date, Scomi Engineering said STP has completed approximately 83% of the project works, which consists of civil works (stations extension, construction of a new depot, stabling yard and train wash plant), wayside systems along the entire alignment, new signalling system for the four-car trains and mixed fleet operations, and the delivery of the six trains.
 
STP will complete the project within the time that it is entitled to, under the third supplemental contract, Scomi Engineering added in its bourse filing.
 
Scomi Engineering shares closed 0.5 sen or 1.23% higher at 41 sen today, giving it a market capitalisation of RM140.2 million.