KUALA LUMPUR, July 14 — Lim Guan Eng had instructed a senior Penang government official to meet with Beijing Urban Construction Group Sdn Bhd (BUCG) representatives when it "lobbied” for an undersea tunnel project, the Sessions Court heard today.

Datuk Lim Hock Seng who is now the section head of the Penang State Economic Planning Unit (Transportation) told the court that Guan Eng who was chief minister at that time, had instructed him to contact two BUCG representatives concerning a proposal for the construction of an undersea tunnel in Penang on January 26, 2011.

Hock Seng, the third prosecution witness in Guan Eng’s corruption trial, added that the chief minister claimed later that the project was to be implemented through an open tender.

According to Hock Seng, the two representatives were Datuk Zarul Ahmad Mohd Zulkifli (the person Guan Eng is alleged to have solicited a bribe from) and Lim Chee Hoe.

"On the 26th of January during a state government council meeting, I affirm that the chief minister had informed that a private company was exploring the suggestion to build an undersea tunnel and had also planned to sign a Memorandum of Understanding (MoU) with the state government.

"I was also personally informed by the chief minister later that the aforementioned company mentioned was BUCG and he provided the contacts of two people — Zarul and Chee Hoe — to call after the council meeting had taken place the same day,” he said in his witness statement.

Hock Seng said he was the Penang state executive councillor in charge of public works, utilities and transportation at that time and had also met the BUCG representative several times prior to the eventual signing of the MoU.

He said he was only acquainted with both men following their initial meeting but did not state when it took place.

At another state government council meeting on March 16, 2011, Hock Seng said he informed those present that BUCG representatives were urging the Penang government to ink the MoU "as soon as possible”.

This eventually led to the signing of a MoU on March 17, 2011 in which both parties agreed to cooperate in alleviating persisting traffic congestion issues in Penang.

The MoU was then tendered in court as an exhibit and affirmed by Hock Seng who testified that two signatures on the document belonged to state government secretary Datuk Farizan Daus and Zarul as BUCG representative. The third signature on the MoU was his own as a witness, Hock Seng said.

Subsequent to the March 2011 MoU, Hock Seng said Guan Eng had on April 27 informed the state government council meeting that the latter would sign another MoU with the BUCG chairman in Putrajaya on April 28.

"The MoU was for the proposal of an undersea tunnel project spanning 5km in length with an expected cost of RM10 billion and fully funded by BUCG themselves.

"Based on this document, I confirm that this MoU explicitly states the company’s interest in taking on the project and that the project was to be implemented through open tender,” he said.

Roughly a month after the second MoU was finalised, Hock Seng also said Guan Eng had asked for the request for proposal (RFP) to be hastened during a state government council meeting, following an indecisive meeting held earlier with BUCG concerning the tunnel’s construction on May 19.

He also affirmed that a delegation of 10 individuals representing the state government had visited Beijing in the People’s Republic of China for a week between June 2 and June 8, subsequent to an official invitation by BUCG’s general manager which was extended to the Chief Minister. 

"All accommodation, travel tickets and sustenance expenses are paid for by the state government,” he said after the delegation was approved by the state government council meeting.

Guan Eng, a former Penang chief minister as well as former federal minister of finance, is accused of soliciting kickbacks amounting to 10 per cent of the profits raked by Consortium Zenith, which were later valued at RM3.3 million, to help the company secure the RM6.3 billion project.

The RM6.3 billion project, comprising an undersea tunnel and three roads, was mooted by the state government to alleviate traffic jams on the Penang Bridge.

The Bagan MP was also charged with two counts of dishonest misappropriation of property on two plots of land belonging to the Penang government worth RM208.8 million to be disposed of to two companies, which are linked to the state’s undersea tunnel project.