HDC board accepts CRCC’s $9.4 million Rasmale work claim despite lower valuation

The Housing Development Corporation (HDC) Board has decided to recognise a USD 9.4 million claim by China's CRCC Harbour & Channel Engineering for work carried out under the terminated Rasmale reclamation project, despite an independent assessment valuing the work at USD 6.7 million, according to information obtained by Dhauru.

The difference between CRCC's claim and the assessment amounts to USD 2.7 million.

CRCC was awarded a contract in July 2024 to reclaim 352 hectares across five sites in Rasmale within 18 months. The contract was valued at USD 265.5 million, equivalent to about MVR 4.1 billion.

HDC terminated the agreement in July 2025 after the reclamation work failed to progress in accordance with the contract.

Before the termination, CRCC had received an advance payment of USD 13.2 million, representing 5% of the contract value.

Following the termination, CRCC claimed it had completed work worth USD 9.4 million, or about MVR 145.2 million.

HDC subsequently commissioned Epoch Associates to conduct an assessment of the work completed by the company.

The assessment report, which was leaked on social media, valued CRCC's completed work at USD 6.7 million, or about MVR 104.7 million. Sources cited by Dhauru confirmed the authenticity of the report.

The assessment therefore places the value of the work USD 2.7 million below the amount claimed by CRCC.

However, according to information obtained by Dhauru, the HDC Board decided at a meeting last week to recognise the USD 9.4 million claimed by CRCC rather than use the value determined by Epoch Associates.

The Board also decided not to recover the remaining portion of the advance payment at this stage, according to a source familiar with the matter.

"After deducting the USD 9.4 million claimed by CRCC from the advance payment, a balance of USD 3.8 million remains. The Board decided not to recover this remaining money either, and to determine how to handle those funds at a later date," the source told Dhauru.

According to the source, one option being considered is to use the remaining amount towards another HDC project involving CRCC.

"The Board's inclination is to award CRCC another HDC project using that remaining money. However, the Board will make a formal decision on how to use those funds later," the source said.

Sources within HDC have raised questions over the decision to recognise CRCC's valuation instead of the figure determined through the assessment commissioned by HDC.

"The figure established in the independent evaluation represents the maximum amount that should be paid to CRCC, even under the most generous valuation. The company has not actually performed much work," a source cited by Dhauru said.

The original Rasmale contract was for the reclamation of 352 hectares across five sites. HDC revoked the project from CRCC about a year after the contract was awarded, with much of the contracted work remaining incomplete.

The difference between the independent assessment and CRCC's claim, together with the decision not to recover the remaining USD 3.8 million advance, has prompted questions over HDC's handling of the terminated contract.

Dhauru said it had sought a response from HDC over the past two days. The corporation had not issued a statement on the matter at the time of reporting.