July 26 2002- Malaysian plans to build the Bakun hydroelectric dam in Borneo have drawn keen interest from foreign firms despite criticism it was a waste of money, Prime Minister Mahathir Mohamad said on Thursday.

“It’s very much a government project but I must admit, there’s a great deal of interest by international players to participate in the Bakun project,” Mahathir told a news conference at this port in the southern state of Johor.

“The project…was condemned by foreign journalists as a waste of money but good business people see a great potential in the Bakun project,” said Mahathir, who regularly accuses foreign media of running down the country.

He said the government had no current plans to sell a 60 per cent stake in state-owned Sarawak Hidro to tycoon Syed Mokhtar Albukhary, as reported in the Far Eastern Economic Review’s August 1 edition.

“At the moment, no. At the moment, we haven’t sold,” he said at an event where he was flanked by the Syed Mokhtar himself, who smiled at reporters’ questions but said nothing.

Sarawak Hidro assumed responsibility for the Bakun project in 1999 after it was stalled by the 1997/98 Asian financial crisis.

The Far Eastern Economic Review said Syed Mokhtar, whose business interests range from ports to hotels, is bidding for the whole of the controversial Bakun dam project in Borneo.

It quoted unnamed financial executives as saying the businessman had pitched for the $2.4bn project, proposing to take 60 per cent of Sarawak Hidro in the process. “The idea is being taken seriously,” the weekly said.

The magazine said Syed Mokhtar, whose port of Tanjung Pelepas in the southern Peninsular Malaysian state of Johor has won valuable container shipping business away from neighbour Singapore, intends to sell ten per cent in Sarawak Hidro to a strategic investor in Dubai.

That partner would help to build an aluminium smelter in Sarawak to exploit the abundant energy available from the proposed hydro-electric dam, the magazine said.

Syed Mokhtar is consolidating his various ventures into Malaysia Mining Corp, which recently won regulatory approval to buy a controlling stake in the tycoon’s privately held Port of Tanjung Pelepas.

Representatives of the businessman, who controls both PTP and its eastward sister port Pasir Gudang, site of Thursday’s news conference, were not immediately available for comment.

Government and industry sources told Reuters on Monday four Malaysian-led groups had bid $526m apiece for contracts to start work on the main dam, a venture criticised by economists and environmentalists.

The project, which will submerge an area of tropical forest the size of Singapore and displace thousands of people from various indigenous groups, was revived in 2001.

Economists have said it is not commercially viable.