Allegations that Malaysia had produced centrifuge components for Libya's uranium-enrichment program were "unfounded," national police chief Bakri Omar said in a statement.

"Investigations so far showed that not one company in Malaysia has the ability to manufacture a complete centrifuge unit because this requires technological capability and high expertise in the field of nuclear weapons," he said.

Bakri said he issued the statement after allegations about Malaysia's involvement were included in foreign media reports about Pakistan's top nuclear scientist admitting to the unauthorised transfer of nuclear know-how to Iran, Libya and North Korea.

Bakri said a Sri Lankan businessman known only as Tahir, who was also mentioned in the reports, was not under arrest.

However he and the local company that was allegedly involved, Scomi Precision Engineering Sdn. Bhd. (SCOPE), were under police investigation and have both given full cooperation, Bakri said.

He said investigations were launched after the special branch received information on November 10 last year from US and British intelligence that Tahir was supplying centrifuge components made in Malaysia for Libya's uranium-enrichment program.

The intelligence revealed that five containers allegedly containing centrifuge components were seized from a ship, BBC China, in Taranto, Italy on October 4.

The containers had a "SCOPE" seal and Malaysian police investigations confirmed that Tahir had in 2001 contracted SCOPE to manufacture the components that he claimed were legitimate.

SCOPE had set up a factory in central Selangor state for the purpose, Bakri said.

But he said nuclear experts could not be sure that the components seized from the ship in Italy were for centrifuge and that early investigations showed that the components could also be used for petrochemical tools, water treatment and other health functions.

SCOPE is a unit of listed oil and gas firm Scomi Group. Kamaluddin Abdullah, the son of Malaysian Prime Minister Abdullah Ahmad Badawi, is a substantial shareholder in Scomi.

Scomi said in a statement that the contract, worth 13 million ringgitmillion dollars), was arranged by Tahir to manufacture 14 semi-finished components to Gulf Technical Industries LLC (GTI) in Dubai.

It said it was never told of the end-use of these components and that it had shipped them to GTI in four consigmnents from December 2002. The pact accounted for less than four percent of its group turnover, it added.

WAR.WIRE