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Update On klia2

05 June 2013

Sepang, 5 June 2013 - Pursuant to the Bursa release dated 29 May 2013, MAHB wishes to clarify that extensions had been granted to contractors and which had already accounted for all the changes requested from all stakeholders of klia2 up to now. However MAHB is of the view that there is no justification for any further extension and therefore Liquidated Ascertained Damages (LAD) will apply.

MAHB believes that the cause for the delay despite repeated commitments was due to insufficient resources to complete the work according to its programme and deadline.

We would also like to confirm that at this point all variation orders have been addressed and as of now with the overall project being 90% completed, the cost is still below RM 4 billion.

At this stage a new date cannot be determined unless and until a detailed work programme and resource planning by the affected contractors can be scrutinised by the Project Management team and our consultants, which have yet to be submitted to date. This is to enable MAHB to be convinced that there will be no further slippages on the committed date of completion as had happened in the past. MAHB will continue to work closely with the affected contractors to resolve their problems in the most amicable manner for all parties concerned.

In the meantime, we had foreseen the congestion developing at the current LCCT and have already discussed with AirAsia as well as the other airlines on action plans to manage the capacity issue. We will continue to engage them to minimise any inconvenience to passengers. The LCCT is part of the KLIA airport system, and hence will be able to leverage on the overall KLIA capacity.

The low cost airline industry had gone through a dynamic phase where its original business model has evolved significantly to what it is today. We had to take into account all stakeholder requirements in order to support the future of low cost airlines in building klia2.

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