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ACC & Transmission Gully/ Wellington Gateway Project

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Posted 09 September 2014 - 05:15 PM

$125m a year for 25 years = the cost of Transmission Gully
September 8, 2014comments


The Transport Agency has explained how Transmission Gully will cost taxpayers three times as much as the $850m which is being stated as its “present cost”.

News from NZTA
The Transmission Gully project’s net present cost is $850 million. This is the “whole of life” cost, for the Wellington Gateway Partnership to build and then operate the road for 25 years. Because the costs are spread over time, they are expressed in today’s terms.

This is $25m less than what the contract would be expected to cost through conventional procurement, and hence meets The Treasury’s value for money test for public private partnerships.

The cash payments will be around $125 million per year, starting only when the project is finished and open for use, and lasting for 25 years. This stream of cash payments brought back to today’s dollars is $850 million and is the “net present cost”.

News from Wellington Gateway Partnership
Prime Minister John Key, Transport Minister Gerry Brownlee and Wellington Regional Council Chair Fran Wilde have taken part in a soil turning ceremony with the Wellington Gateway Partnership (WGP) to mark the Transmission Gully project contract award.

The group broke ground at the far northern tip of the project site, ahead of work that will move 6.5 million cubic metres of earth during five years of construction.

The 27 kilometre motorway is the first state highway to be built as a public private partnership. The WGP will finance, design and construct the project, and then operate and maintain the Transmission Gully Motorway from 2020 for a period of 25 years.

WGP Chief Executive David Low said: “Safety and quality, together with respect for the community and environment will be paramount throughout the life of the Transmission Gully Project”.

WGP has subcontracted Design and construction to a joint venture of Leighton Contractors and HEB Construction, who combined have more than fifty years of experience in road and bridge building within New Zealand.

“The LHJV integrates local and international experience to successfully address the challenges of constructing 27 kilometres of motorway and 28 bridges through steep terrain,” said David.

Project Director Mick O’Dwyer will lead the LHJV team to construct the new motorway route through 11 different geological terrains from rugged rocky outcrops through to rolling farmland.

“The terrain presents some challenges which will require diverse construction techniques and equipment – from bulldozers to mechanical scrapers, diggers and dump trucks depending on where we are working.

“Over the coming months we will be completing detailed design. The community will also see us out in the field progressively fencing, relocating services, establishing environmental controls and setting up our site office”.

Weather permitting, major construction work is scheduled to begin during the Spring/Summer of 2015.

The Project
The Transmission Gully PPP Project includes the financing, design and construction of a 27 km long expressway standard motorway just north of Wellington, with a 25 year operations and maintenance contract. The new motorway will bypass the existing SH1 coastal route, increase road safety and improve network reliability with high levels of seismic resilience. It will also be a catalyst for economic growth in the Wellington region.

Wellington Gateway Partnership
The Wellington Gateway Partnership is made up of Infrared Capital Partners Limited, Accident Compensation Corporation (ACC), Leighton Contractors and HEB Construction. The consortium combines local and international experience in the financing, design, construction, operation and maintenance of substantial Public Private infrastructure projects.

Leighton Contractors
Leighton Contractors, a wholly-owned subsidiary of Leighton Holdings Limited, is one of Australia’s leading contracting and project development groups, with over $13 billion work in hand and employing more than 14,000 people across Australia, New Zealand, Papua New Guinea and Africa. The company delivers projects for clients across the infrastructure, telecommunications, civil construction, industrial, energy, health and services sectors.

Leighton Contractors has a strong presence in New Zealand and has previously worked with NZTA to successfully deliver major projects including the SH20-1 Manukau Extension (2010), the Newmarket Viaduct Replacement (2012) and the current SH16 Causeway Upgrade which is scheduled for completion in 2017.

HEB Construction Ltd (HEB)
HEB Construction is one of the largest and most successful privately-owned civil construction companies in New Zealand, currently employing more than 700 people nationwide.
Founded more than 35 years ago, HEB brings a range of essential services to the Transmission Gully project such as structures, roading, drainage, landscaping, temporary traffic management, surfacing and precast concrete element capability.
HEB’s current roading projects include Wellington’s Memorial Park Alliance, the Waikato Expressway – Cambridge Section, Tauranga Eastern Link JV, and Auckland’s Greville Road Interchange.

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