John Holland. Photo John Holland

Rigorous bidding phase key to PPP success, expert says

Extensive preparation for all aspects of a project during the bidding stage is crucial to the successful delivery of a Public Private Partnership, John Holland executive general manager of development and investments Tom Roche has said.

Roche recently spoke with Rail Express publisher Informa Australia ahead of Informa’s National PPP Summit on November 15-16 in Melbourne.

“You need to plan for success” Roche said. “And spend far more preparation time than you may initially anticipate.

“You need to plan for all the key elements of the project – design, construction and commissioning – from day one. The foundations of success are created during the bid phase of most projects.”

John Holland is no stranger to PPPs in the rail sector.

The construction and engineering group, which was recently acquired by China Communications Construction Company, is currently engaged in PPP contracts to help deliver Canberra’s Capital Metro light rail line, the Sydney Metro Northwest project, and several others.

Roche, who has enjoyed a three-decade career delivering PPPs, firmly believes a good contractor should be preparing as early as possible and building strong relationships with their public sector clients.

He also cites the importance of having sufficiently skilled staff, in areas like negotiation and design and client management.

“You need people who can present appropriate, well-thought out arguments, can present the value of their design and construction approach and bring the clients on the journey with them,” he told Informa.

“You need your best people in design development as well as construction in order to be sure that the project will progress well.”

On top of this, he argued staff must have a ‘partnership mentality’.

“Some people treat PPPs in the same way as traditional procurement models. It’s human nature,” he said. “Some look for ways to cut corners.”

Roche believes being seen to be doing your best and having the client’s interests at heart is conducive to a good relationship, and therefore to a successful project.

Tom Roche will speak at the National PPP Summit in Melbourne this November. As well as presenting strategic advice regarding the practical and logistical side of PPPs, he will discuss how he believes effective partnerships can be forged.

PPP Conference

Work begins on Melbourne Metro Tunnel

Construction of Melbourne’s Metro Tunnel project has officially kicked off, with John Holland starting early works in the CBD this week.

John Holland, which holds the $324 million early works contract for the project, has now begun work to move up to 100 utility services under the city’s surface.

The contract also includes excavating the 11-storey deep shafts next to Swanston Street to enable the construction of the two new city stations, which will be built to access the new cross-CBD line.

The stations, and the tunnel itself, will be built by one of the three consortia named to the shortlist for the $6 billion Metro Tunnel and Stations PPP in August:

  • Continuum Victoria – comprising ACCIONA Infrastructure, Ferrovial Agroman, Honeywell, Downer EDI and Plenary
  • Cross Yarra Partnership – comprising Lendlease Engineering, John Holland, Bouygues Construction and Capella Capital
  • Moving Melbourne Together – comprising Pacific Partnerships, CPB Contractors, Ghella, Salini Impregilo, Serco and Macquarie Capital

The Request for Proposal has now been released to the three bidders.

Two consortia were also shortlisted earlier this month for the $1 billion Rail Systems Alliance signalling contract to facilitate the Metro Tunnel project:

  • A consortium comprising CPB Contractors and Bombardier Transportation
  • The MetroConnect consortium comprising John Holland, Siemens and UGL

The other major contract relating to the tunnel, the High Capacity Metro Trains (HCMT) deal, was awarded to the Evolution Rail consortium of Downer Rail, CRRC and Plenary, on September 12.

Victorian public transport minister and acting premier Jacinta Allan used the start of early works as an opportunity to remind the Federal Government “not to break their promise on asset recycling,” and give the state a full 15% payment as a result of this week’s $9.7 billion privatisation of the Port of Melbourne.

The Turnbull Government has said it will not pay the full 15% incentive dictated by its asset recycling scheme, because the port was not sold by June 30 – a justification Victorian ports minister Luke Donnellan has called “an absolute disgrace”.

Allan on Thursday reminded the Federal Government that Victoria is home to 25% of the country’s population, and is its “fastest growing state”.

Despite this, Allan says, Victoria receives just 9% of national infrastructure funding.

“Malcolm Turnbull should keep his promise to Victorians and help us deliver even more critical transport infrastructure,” Allan said.

“You can’t have one rule for New South Wales, and a different one for Victoria.”

Melbourne Metro rail tunnel. Graphic: Victorian Government

Two shortlisted for $1bn Melbourne signalling deal

Two consortia have been shortlisted to deliver up to $1 billion of signalling and communications systems as part of the Metro Tunnel project in Melbourne.

Public transport minister Jacinta Allan on Friday announced the shortlisted bidders for the Rail Systems Alliance deal:

    CPB Contractors and Bombardier Transportation
    John Holland, Siemens and UGL (MetroConnect)

The winning consortium will install high capacity signalling on the Sunbury-to-Pakenham line which the Metro Tunnel will facilitate – the first roll-out of HCS on an existing network anywhere in Australia, Allan said.

“The world’s best have been shortlisted to deliver the biggest and most advanced signaling package in Victoria’s history,” the minister said.

“The successful bidder will install next generation signaling, which will allow safer, more frequent and reliable services in and out of the city in peak hour.”

The new technology will allow Metro Trains Melbourne to run up to 30 services an hour on the line.

The two shortlisted bidders will be asked to submit a formal proposal by early 2017, with a contract expected to be awarded later that year.

Allan also announced the establishment of a Centre of Excellence as part of the project, to support local skills, jobs and opportunities in the signalling and communication industry.

TfNSW asks shortlist for Sydney Metro tunnel tenders

Transport for NSW has officially called for tenders from the two consortia selected to the shortlist to build the Sydney Harbour tunnel for the second stage of the Sydney Metro project.

A consortium of Ferrovial, Acciona and BAM, and a consortium of John Holland, CPB and Ghella were both named to the shortlist to deliver the project earlier this year.

NSW transport and infrastructure minister Andrew Constance on September 2 officially invited the two shortlisted candidates to tender for the twin tunnel construction deal.

“When Sydney Metro is extended into the CBD and beyond in 2024, there will be ultimate capacity for a metro train every two minutes in each direction under the city,” the minister said.

While the network will be built for up to 30 trains per hour in each direction (i.e. one “every two minutes”), TfNSW is only planning for initial capacity of one train every four minutes at peak, in each direction on the new line.

The call for tenders comes as construction is getting underway on the first station platform on the Sydney Metro Northwest project.

The Northwest portion of the Sydney Metro project will connect Sydney’s north west with Chatswood, via a new line to Epping, and the conversion of the existing Epping-Chatswood link.

The tunnel under the harbour will make up a significant portion of the second stage of Sydney Metro, which will extend the new line from Chatswood to the CBD, then on to Sydenham, where it will merge with the existing line, which will also be converted to Metro standard as far as Bankstown.

Rebuilt Metro stations opened

Melbourne Metro stations Ormond and Bentleigh, both rebuilt as part of the removal of level crossings on the Frankston line in the city’s south, have been re-opened two days ahead of schedule.

The stations were rebuilt by a consortium of John Holland and KBR, which won the first major contract under the Andrews Government’s multi-billion-dollar plan to remove 50 level crossings around the greater Melbourne area.

The $524 million contract, awarded in early 2015, covered the removal of four level crossings, at Centre Road in Bentleigh, North Road in Ormond, McKinnon Road in McKinnon and Burke Road in Glen Iris.

As part of that work, Bentleigh, Ormond, McKinnon and Gardiner stations were to be rebuilt at each site, respectively.

Burke Road became the first level crossing project completed midway through this year, and thus Gardiner station was the first rebuilt station opened under the work program. McKinnon Station was opened a few months later, and now Ormond and Bentleigh stations have been opened to follow suit.

“This is the first time in Victoria’s history that three level crossings have been removed at the same time,” public transport minister Jacinta Allan said, referencing the combined removal of the North Road, McKinnon Road and Centre Road crossings.

“[It’s] an incredible effort by everyone who worked around the clock to make our roads safer and less congested,” Allan added.

“In less than 18 months, we’ve removed four level crossings in Melbourne’s south-east, and started work on getting rid of another 15.”

Frankston line trains resumed service on August 1 after the line was closed for the removals. But as of August 29, those trains now stop at Ormond and Bentleigh stations as well.

In coming months, final works will take place at all three new stations on the Frankston line to install lifts, rebuild car parks, and complete landscaping.

Melbourne Metro rail tunnel. Graphic: Victorian Government

Three shortlisted for Melbourne Metro tunnel

A trio of consortia have made the shortlist for the $6 billion PPP to build the Melbourne Metro Tunnel.

Premier Daniel Andrews named the following three consortia to the shortlist on August 11:

Continuum Victoria – comprising ACCIONA Infrastructure, Ferrovial Agroman, Honeywell, Downer EDI and Plenary

Cross Yarra Partnership – comprising Lendlease Engineering, John Holland, Bouygues Construction and Capella Capital

Moving Melbourne Together – comprising Pacific Partnerships, CPB Contractors, Ghella, Salini Impregilo, Serco and Macquarie Capital

Under a PPP agreement, the winning bidder will build and fit-out the planned nine-kilometre Metro Tunnel and five new underground stations at Arden, Parkville, CBD North, CBD South and Domain.

Andrews said up to six tunnel boring machines are expected to be used during construction.

“The best construction companies in the world are lining up to build the biggest public transport project in Australia – the Metro Tunnel,” he said.

To prepare for major works, three shafts will be excavated in the city’s CBD. The shafts will be up to 11 storeys deep and will enable the roadheaders to be lowered into the ground to begin excavating the tunnels.

“Melbourne needs the Metro Tunnel and we’re not wasting a moment,” the premier said. “Major work starts next year.

“The Metro Tunnel will let us run trains so often that you don’t need a timetable – you just turn up and go.”

Shortlisted bidders for the PPP will be asked to submit a formal proposal by early next year, and the government expects to award a contract by the end of 2017. Work on the tunnel and stations will begin in 2018.

Transport-hungry Downer wins Newcastle Light Rail

NSW transport minister Andrew Constance has announced Downer EDI as managing contractor for the Newcastle Light Rail project, a week after the engineer signalled its desire to go after more contracts in the public transport sector.

Constance on August 9 announced Downer had been selected from a shortlist which also included CPB Contractors, John Holland, Laing O’Rourke, and McConnell Dowell.

Under the contract, Downer will partner with Transport for NSW to design, construct and commission 2.7 kilometres of light rail track, six stops, a stabling and maintenance facility, road works and associated precinct works.

Downer chief executive Grant Fenn was delighted with the news.

“Downer has a long and proud history in Newcastle,” he said on Tuesday.

“Downer works closely with Transport for NSW and we look forward to helping them deliver the signature project for Newcastle and to contribute to the revitalisation of the state’s second largest city.”

Fenn last week told the Australian Financial Review the company would target passenger rail and bus contracts after it announced a 14% drop in net profit to $180.6 million, and said it faced “continued pressure” in its resources businesses.

Struggles in a depressed resources sector necessitate the ASX-listed engineer’s further diversification into other areas.

As Downer said in its August 4 Investor Presentation: “The company is progressing well in repositioning to service increased investment and outsourcing in roads and rail, public transport, utilities, defence and communications”.

The ASX responded well to Downer’s update, with the company’s share price climbing from a $4.16 close on August 3 to roughly $5 a share to start this week.

Along with the Newcastle Light Rail project, Downer is also in the hunt for the $2.8 billion NSW Intercity Fleet deal, and Victoria’s $2 billion contract to deliver 65 high capacity metro trains.

Downer is partnered with Changchun Railway Vehicles in both bids, and Rail Express sources suggest a winner could be announced for one of the rollingstock contracts in a matter of days.


Changes in store for Newcastle network

Constance said Downer was chosen for the Newcastle Light Rail project “following a competitive tender process, which was overseen by an independent Probity Advisor”.

The minister also announced a trio of changes to the existing plans for the line, made as a result of public consultation.

Instead of raised tracks, all tracks along the route will be built flush with the road.

The second change will see a slight alignment shift at Worth Place “to ensure a smoother turn and quicker travel time”.

Finally, as a result of the consultation, a second track will be built across Stewart Avenue near the new Wickham Interchange to reduce disruption when future extensions are built to the light rail network.

Constance said the changes were a sign the state government was taking on board suggestions from the public, and was committed to working with everyone involved “to make sure green space, footpaths, cycleways and parking are front and centre as the final designs are progressed”.

“These improvements are a win-win for customers and local residents,” Constance added.

Newcastle Light Rail will run from a new transport interchange at Wickham – where the heavy passenger line from Sydney ends – to a terminus at Pacific Park on the other side of the Newcastle CBD.

Spanish manufacturer CAF will supply six of its Urbos trams for the new network.

Two shortlisted for second Sydney Harbour tunnel

Two groups have been shortlisted to build twin tunnels under Sydney Harbour and the CBD as part of the second stage of the Sydney Metro project.

With tunnels complete and work progressing on the Northwest stage of Sydney Metro, which will see a new line link Sydney’s growing north-west to Chatswood, the government is now in the process of engaging the industry for stage two of the line, Sydney Metro City & Southwest.

Sydney Metro’s second stage will continue the line from Chatswood, under the harbour and the CBD and on to the existing line at Sydenham, which will then be converted to metro standard as far as Bankstown.

On August 4, Transport for NSW announced the two firms which will compete for what is likely the most significant contract to come out of the City & Southwest project: the tunnel itself.

The two shortlisted joint venture parties are comprised as follows:

John Holland, CPB Contractors, and Ghella

Ferrovial Agroman (Australia), Acciona Infrastructure Australia, and BAM International Australia

NSW transport minister Andrew Constance said he expects the first of the giant tunnel boring machines to be in the ground before the end of 2018, saying the government has received interest “from here and abroad” from companies wanting to carry out the work.

The contract, which also includes station excavation works, was opened for Expressions of Interested on April 13, and closed to entrants on May 31.

Constance said there were more than 18 tunnelling and civil engineering organisations involved in the EoI stage.

The Sydney Metro project was fully funded after June’s state budget included $12 billion in funding over the next four years.

The budget committed $5.8 billion to finish the Sydney Metro Northwest stage, and $6.2 billion for Sydney Metro City & Southwest. Both stages will receive roughly $1.3 billion in funding in the 2016/17 financial year.

Three shortlisted for Melton Highway crossing removal

Victoria’s Level Crossing Removal Authority has named a trio of bidders to the shortlist for a contract to remove the level crossing over the Melton Highway at Sydenham, in Melbourne’s north-west.

Following a “competitive” expressions of interest period, launched earlier this year, the LXRA on July 27 announced the following bidders had progressed to the shortlist:

  • BMD Constructions Pty Ltd
  • Seymour Whyte Constructions Pty Ltd
  • WBHO Infrastructure Pty Ltd and Rizzani de Eccher Australia Pty Ltd (joint venture)

The three shortlisted bidders will be given a Request for Tender, LXRA said.

The preferred design to remove the level crossing at Melton Highway is a road bridge over the rail line, according to the authority.

The LXRA says it has been gathering feedback from local residents, council and local businesses since February, and has used this to refine the project’s design, which the bidders will have to address in the next stage of the tender process.

A contract will be awarded by the end of 2016, and the crossing is targeted for removal by late 2018.


Future development considered at removal sites

Meanwhile, the Victorian Government has announced it will investigate development opportunities at Ormond, Bentleigh and McKinnon stations, as well as near Gardiner station on Burke road.

The LXRA says the research is part of the government’s “vision to create vibrant communities and deliver economic, social and environmental benefits around transport hubs”.

Level crossing removals are almost complete near Ormond, McKinnon and Bentleigh stations on the Frankston line, and all three projects include rebuilding the respective stations to suit the new corridor setup.

The Burke Road level crossing is the first – and so far only – level crossing removal classed as complete by the LXRA, with the project rebuilding the Gardiner station on the Glen Waverly line.

All four removals were contracted to a joint venture of John Holland and KBR.

“As part of the construction of the new Ormond Station, a deck is being built over the rail line to enable a major new mixed-use development,” the government said in a statement.

“The deck is the first step towards enabling development of up to 13 storeys at the site. This could include new apartments, retail space or a supermarket, encouraging more people to stay in the area to shop local, and providing flow-on benefits for existing local businesses.

“Sites next to Bentleigh and McKinnon Stations are also being future-proofed as part of the level crossing removal works to enable future developments, although given the nature of the local neighbourhoods, they will be significantly smaller in scale.

“Any future developments at these sites will need to follow the Government’s prescribed planning approval processes, including a draft planning scheme amendment process, which would involve a public exhibition and consultation stage.”

Cancelling light rail could kill Canberra’s credit rating: Report

Infrastructure Partnerships Australia boss Brendan Lyon has warned the Australian Capital Territory’s AAA credit rating would be downgraded if the Capital Metro light rail project is cancelled after the territory election later this year.

The ACT Liberals say they will cancel the light rail project if they overthrow the incumbent Labor Party at the election, scheduled for October 15.

A contract has already been awarded for the project, to a consortium including Pacific Partnerships, CPB Contractors, John Holland, Mitsubishi Corporation, Aberdeen Infrastructure Investments, Deutsche Bahn International and CAF.

An estimates hearing in Canberra last month revealed taxpayers would be liable for a quarter-billion-dollar bill if the project is cancelled now.

Lyon has warned a cancellation would remind the international market of the disastrous East-West Link saga in Victoria, where newly-appointed premier Daniel Andrews cancelled a road project, leaving taxpayers with a roughly billion-dollar bill (and no road to show for it).

Perhaps more important than wasting money now, however, would be the loss of the ACT’s perfect credit rating, Lyon has said.

“Any scheme to dishonour Canberra’s light rail contract will pose large compensation and reputation costs,” Lyon was quoted in the AFR this week, “and could quite foreseeably see the territory stripped of its AAA.”

Lyon’s comments in the AFR came a fortnight after he responded to the estimates hearing by warning the ACT Liberals to cancel their plans to quash the project, should they win the tightly-contested election.

“Axing Canberra’s Capital Metro would see taxpayers pay a quarter of a billion dollars, for absolutely nothing,” Lyon said on June 28.

“With a legal, valid and binding contract in place for the Capital Metro, it was never responsible to pretend that sovereign risk would be anything other than very costly to Canberra.

“The Canberra Liberals threat to axe the light rail contract was always irresponsible,” he continued.

“There are quite correctly very large costs and serious consequences for governments that don’t pay their bills or follow contracts.”

In February – two months before the contract was signed – Capital Metro minister Simon Corbell told Rail Express the light rail line was “a once in a lifetime opportunity,” being threatened by the potential of “a reckless cancelling of the contract.”

Mernda design revealed, two bidders shortlisted

A pair of bidders have been shortlisted to build a $588 million extension of Melbourne’s South Morang line to the growing north-east suburb of Mernda.

The Mernda Rail Extension will extend the Metro Trains Melbourne network with two (potentially three) new train stations along eight kilometres of duplicated rail line.

John Holland and a joint venture of McConnell Dowell Constructors and UGL Engineering were named to the shortlist to deliver the project on Thursday.

The winning bidder will extended the rail line north-east from its current terminus at South Morang station, to a new terminus at Mernda, via a new station at Marymede.

Bidders have also been asked to price a potential new station at Hawkstowe, between Marymede and Mernda.

The contract also includes the construction of new train stabling facilities at Mernda.

Click to enlarge.

Mernda extension map. Graphic: Level Crossing Removal Authority


Victoria’s Level Crossing Removal Authority is directing the project.

Designs revealed on Thursday show the line will mostly be at grade, with some sections on raised embankments. The plan shows five grade separations – either elevated rail or sunk into the ground – where the line will cross highways, roads and rivers along the planned route.

Victorian public transport minister Jacinta Allan said the grade separations meant no new level crossings would be built.

Allan said a contract will be awarded early next year, with construction to begin shortly afterwards. First operations are targeted for 2019.

“We’re not just talking about growth, we’re building for it,” the minister said, “extending public transport to new communities so they can get to work, school and appointments, and home again at the end of the day safer and sooner.”

Canberra light rail. Graphic: ACT Government

Opposition warned to stand down after contract signed for Canberra light rail

The Australian Capital Territory Government has signed a PPP contract with a consortium of at least seven parties to build a light rail line from the northern suburb of Gungahlin to Canberra’s city centre.

Canberra Metro was the consortium selected as preferred bidder in February to construct and operate the line, which is described as ‘stage one’ of light rail in the nation’s capital.

The consortium is made up of Pacific Partnerships, CPB Contractors, John Holland, Mitsubishi Corporation, Aberdeen Infrastructure Investments, Deutsche Bahn International and CAF.

The team will deliver 12 kilometres of light rail track, 13 stops, 14 light rail vehicles, and will operate and maintain the line for at least the first 20 years.

ACT Government estimates put the project’s capital cost at $710 million. The territory government is contributing $375 million, while the Commonwealth will contribute $67 million.

Australasian Railway Association boss Danny Broad welcomed the news, but warned the ACT Opposition to stand down its campaign against the project.

The Opposition has said it will cancel the line if it wins the ACT election on October 15. It believes buses would provide a better solution than light rail.

Capital Metro minister Simon Corbell in February criticised the Opposition’s plans, calling light rail “a once in a lifetime opportunity,” threatened by the potential of “a reckless cancelling of the contract”.

Broad agrees that the threat of cancellation needs to be lifted.

“The debate over light rail versus bus is nonsensical and entirely misses the point,” the ARA boss said on Tuesday.

“The best approach is to find a way for the two to work together to provide a world-class public transport system for Australia’s capital city.

“It is common for Australian light rail projects to initially face political and public opposition. But when testing commences, that negativity is replaced with support and calls for an extension of the network.”

Infrastructure Partnerships Australia chief executive Brendan Lyon also warned the Opposition to stand down.

“The signing of binding contracts is the right thing to do for this project,” Lyon said.

“There has been a lot of noise from the Opposition about what they might do but with the contract signed, sealed, and made public it’s time to recognise this is a binding legal document and move away from suggestions of political risk.

“Everyone respects the rights of the Opposition to oppose legislation but it’s time for the Canberra Liberals to go back to a position of respecting contracts and the rule of law.”

The discussion is no doubt stirring recent memories of the Andrews Government’s costly cancellation of contracts to build the East-West road project, which were signed by the previous state government shortly before Andrews won the most recent state election.

Winter blitz to remove crossings ahead of time

A month-long closure of a portion of Melbourne’s Frankston line will help workers remove three level crossings, six months ahead of schedule.

A joint venture of John Holland and KBR is removing three level crossings on the Frankston line – one at North Road, Ormond, another at McKinnon Road, McKinnon, and the third at Centre Road, Bentleigh.

A section of the line will be closed from June 24 to July 31, to allow workers to lower the train line below road level.

Thousands of bus services will replace trains during the closure.

“When train services resume on 1 August 2016, the level crossings at these three sites will be gone for good and trains will travel under the roads,” the Level Crossing Removal Authority said earlier this month.

The closure will also allow crews to begin the three new station rebuilds under the John Holland/KBR deal – Bentleigh station, McKinnon station, and Ormond station.

“We’re not waiting for another near miss or another ambulance to get stuck at the boom-gates,” local member for Bentleigh Nick Staikos said.

“We’re getting rid of these dangerous crossings as soon as we can, to save lives, reduce congestion and improve public transport.”

The Level Crossing Removal Authority has also announced work will ramp up in July to remove four level crossings on the Belgrave/Lilydale split line, with buses replacing trains on certain sections from July 2 to July 10.

A project team of Laing O’Rourke, Fulton Hogan and AECOM is working on crossings on the Belgrave line at Mountain Highway and Scoresby Road in Bayswater.

A project team of CPB Contractors, Aurecon and Arcadis is working on crossings on the Lilydale line at Blackburn Road, Blackburn, and Heatherdale Road, Mitcham.

The Belgrave/Lilydale work in early July will focus heavily on piling activities, as well as the construction of road bridges in preparation of major works over summer, the Level Crossing Removal Authority explained.

Sides strike deal for Perth airport line

The Western Australian Government has finalised negotiations with the joint venture of Salini Impregilo and NRW to design, construct and maintain a rail line to Perth’s airport.

WA transport minister Dean Nalder announced the SINRW joint venture as preferred respondent for the new rail line in February.

On April 28, premier Colin Barnett said the sides had successfully hashed out a deal.

“SINRW are contracted to build the eight kilometres of rail tunnels and three stations for the Forrestfield Line, as well as maintenance of the tunnel and civil structures for 10 years after completion,” Barnett said.

“This is a huge milestone on the path to delivering this project, which will change the face of Perth’s eastern corridor and give people direct access to the airport by public transport.”

With first trains targeted for 2020, the Forrestfield-Airport Line is a $2 billion project to build an 8.5 kilometre rail spur from the Midland Line out to Forrestfield via Belmont and Perth Airport.

Two of the planned stations have been renamed, Nalder announced last week: the station formerly known as Airport West will now be named Belmont, and the station formerly known as Consolidated Airport will now be known as Airport Central.

The new line’s third station will be its terminus, Forrestfield.

$370 million of early work  to build the line is already underway. The contract formally awarded to SINRW last week is worth $1.18 billion.

“Various forward works have been underway at Forrestfield since November 2015 and I expect the joint venture to mobilise on site in the coming months,” Nalder said.

“The project’s direct employment is expected to peak at about 600 workers.”

The SINRW joint venture won the major works contract over two other shortlisted joint ventures: one between John Holland and Leighton Contractors, and another between ACCIONA Infrastructure, BAM International and Ferrovial Agroman.

SINRW is 80% Salini Impregilo and 20% NRW.

NRW is a service provider operating in the civil, mining and construction sectors. Managing director and chief executive Jules Pemberton described the Forrestfield-Airport contract as “a significant milestone in our company’s history”.

Salini Impregilo is an Italian multinational specialising in the construction of major projects. It is already responsible for a $220 million contract to construct the Skytrain section of the Sydney Metro Northwest project.

Shortlist named for Newcastle light rail

Five bidders have been shortlisted to deliver the fixed infrastructure for the new light rail line through the centre of Newcastle as part of the state government’s revitalisation project for the growing city.

NSW transport minister Andrew Constance announced the following five organisations have been shortlisted to tender for the Fixed Infrastructure Contract to deliver the project:

  • CPB Contractors
  • Downer EDI Works
  • John Holland
  • Laing O’Rourke Australia Construction
  • McConnell Dowell Constructors

According to the NSW tender registry, EOIs that didn’t progress to the shortlist were from Coleman Rail & Broadspectrum, Bechtel Infrastructure, Hatch BMD Joint Venture, and Lend Lease Construction Australia.

The winning bidder, to be known as the ‘Managing Contractor’ for Newcastle Light Rail, will be announced later this year.

The new light rail line will replace the old heavy rail line between Wickham and the city’s east. The heavy rail line has been shut for almost 18 months.

The 2.7 kilometre light rail track will include six stops: Wickham interchange, Honeysuckle (near Hunter Street TAFE), Civic, Crown Street, Market Street and Pacific Park.

Click to enlarge. Graphic: Transport for NSW, Google.

Newcastle light rail project map. Graphic: Transport for NSW

Constance noted all five shortlisted respondents have either previous or current experience working on light rail construction projects.

“Their interest is an endorsement of our plans to revitalise Newcastle and shows the private sector understands our commitment to progressing this important project,” he said.

“The NSW Government is committed to delivering a world-class light rail system in Newcastle and the five organisations selected have the right experience and expertise to help us to do so.”

Arrium on the brink

COMMENTARY: Things are not looking good for steelmaker and miner Arrium, especially for its South Australian operations. As well as the obvious social and economic issues, the fate of the Whyalla Steelworks and associated mining operations has the potential to have wider impacts on the rail industry, Mark Carter outlines.

Faced with a heavy debt burden and changing global market conditions, just a couple of months ago Arrium thought it had gained a possible temporary reprieve for its financial problems with a debt lifeline being negotiated with a US private equity interest – or ‘vulture fund’ as one commentator chose to call them.

However this deal has now been rejected by Arrium’s creditors, including the big banks, leaving the board with little option other than to place the business in voluntary administration in attempt to trade its way out of trouble.

In the current climate of low iron ore prices and Chinese steel dumping it is hard to see how this can end in anything but tears – and it also has ramifications for the wider rail industry.

The Whyalla Steelworks and mining operations employ around 3000 people, both direct employees and contractors.

Its operations at Whyalla also generate considerable rail activity. Genesee & Wyoming Australia (GWA) has been sub contracted to provide all internal shunting operations at the steelworks since 1999 on both narrow and standard gauge.

GWA also hauls around 9mtpa of haematite iron ore on narrow gauge tracks from the mines in the nearby Middleback Ranges for export through the recently upgraded port facilities at Whyalla. (The feedstock for Whyalla’s steelmaking comes from magnetite ores fed from the mines via a slurry pipeline.)

Pacific National operates a daily train carrying steel products on the 80km long branch line to Port Augusta, which then feed into PN’s Steelink network of interstate freight trains – the only regular traffic on the ARTC managed branch.

Symptomatic of the problems facing Arrium, and the criticism it has received over some of its investments, is the failed Southern Iron project which has seen a fleet of virtually new locomotives and wagons lying idle at Whyalla for over a year now.

These assets were used to transport around 60,000 tonnes of iron ore a week from Wirrida in the north of South Australia to Whyalla for export, but the traffic lasted less than eighteen months when the collapse in the world price for iron ore and relatively high cost of production caused it to cease.

Arrium had invested heavily in purchasing Western Plains Group’s Peculiar Knob iron ore assets on the back of high ore prices, also in upgrading its port facilities and the new rail operation.

The new traffic flow had even partially influenced ARTC to invest in signalling improvements between Port Pirie and Tarcoola to increase capacity on that corridor. While this section now has a long overdue safeworking upgrade, the revenue to pay for it has evaporated.

This has not stopped ARTC in throwing a small lifeline to the Whyalla Steelworks with PM Malcolm Turnbull and ARTC CEO, John Fullerton, jointly announcing recently that ARTC will fast track a major upgrade to the east-west corridor, replacing 1200 kilometres of rail between Adelaide and Tarcoola at an estimated value of $80m ARTC will partner with Arrium to deliver the upgrade, substantially boosting demand for steel production at the Whyalla facility.

Media reports at the weekend have suggested that Arrium’s top five customers Lend Lease, John Holland, Metricon, BHP and ARTC, as well as federal and state governments will continue placing advance orders for structural steel up to 24 months ahead of construction start dates to boost efforts to keep Whyalla alive.

Although this has not been in time to stop the New South Wales government improving 6,500 tonnes of steel rail from Spain for use on its the Sydney Metro Northwest project.

Turning again to the impact on rail operators, while the loss of the steel traffic ex Whyalla will be a hit for Pacific National it would be one it could cope with, but as we are seeing with similar events with Queensland Nickel, troubled times are not just limited to Whyalla.

Any cessation of business at Whyalla will be another hit to GWA, already reeling from the loss of the Wirrida traffic and other mineral flows in the Northern territory. The company’s US owners must be wondering what they have let themselves in for when things were looking so rosy only two years ago and the Australian operations were the jewel in its crown.

While the outlook for Whyalla is not great, some commentators have suggested that with the its debt burden removed, Arrium’s individual components could all be sold off as going concerns to new owners

Tough times unfortunately that are not just confined to South Australia, and are not confined juts to Australia. For those who cast a wider net for their news similar events are evolving in the UK where the recent closure of one of the country’s largest steelworks has been followed up with the UK’s largest steelmaker, India’s Tata corporation putting all its UK assets up for sale.

Tough times did I say? Crazy times the more you think about it.

Resleepered track on WA's Leonora Branch Line. Photo: Brookfield Rail

KD boss Colin joins ARA board

Keolis Downer chief executive Benedicte Colin has joined the board of the Australasian Railway Association.

Colin’s appointment to the ARA board was announced by ARA chairman Bob Herbert on April 12.

“It is my great pleasure to announce the appointment of Mrs Benedicte Colin,” Herbert said.

“Benedicte brings a wealth of knowledge and experience with her that will be of immense benefit to ARA.”

Colin was appointed as chief executive of Keolis Downer in October 2014, following a short period as interim chief.

Prior to her appointment at Keolis Downer, Colin was refining project manager – general counsel and company secretary at Asquire, the consortium responsible for the Victorian Desalination Plant – the largest PPP to be undertaken in Australia.

“Benedicte was born and raised in Paris where she gained legal qualifications and an MBA,” Herbert continued.

“Her successful legal career included time as a partner at France-based law firm De Gaulle Fleurance and Associés, specialising in corporate law, mergers and acquisitions.

“On behalf of the  Board and ARA members I extend a warm welcome to Benedicte and we  look forward to her advice, wisdom and friendship into the future.”

Along with Herbert, Colin joins ARA chief executive Danny Broad, Sydney Trains boss Howard Collins, NSW Trains boss Rob Mason, ARTC chief John Fullerton, Queensland Rail COO Kevin Wright, Pacific National director David Irwin, WA Public Transport Authority managing director Mark Burgess, Metro Trains Melbourne chief Andrew Lezala, Brookfield Rail chief Paul Larsen, Bombardier Australia boss Rene Lalande, G&WA managing director Greg Pauline, and John Holland executive general manager Karl Mociak, on the board of the rail body.

Tram stopped at Southport South on the Gold Coast Light Rail. Photo: Creative Commons / David Ansen

Gold Coast Stage 2 contractor appointed

A contractor has been chosen to deliver the Gold Coast Light Rail Stage Two project, which will extend the line to a connection at the heavy rail line at Helensvale.

Minister for transport and the Commonwealth Games Stirling Hinchcliffe announced CPB Contractors – formerly Leighton Contractors – as the preferred contractor to design and build the 7.3km extension.

CPB beat out fellow shortlisted bidders John Holland, and a consortium of Downer EDI and BMD Constructions.

Hinchliffe said the state had chosen the best value for money bid, as well as a bidder that provided the assurance that construction would be completed by early 2018.

The light rail extension has to be finished in time for the 2018 Gold Coast Commonwealth Games.

“CPB Contractors has extensive rail experience and a strong track record in the construction industry and most importantly they’ve given a commitment Stage 2 construction will be opened ahead of the Gold Coast 2018 Commonwealth Games,” Hinchliffe said.

“The Palaszczuk Government is satisfied CPB Contractors is experienced, well-qualified and has the expertise to manage the design and construction of the second stage of the Gold Coast Light Rail system and deliver it in time for the 2018 Games.

“Now we’ve announced the preferred contractors, early works on the light rail extension will able to start next month.

“Once it is built Stage Two, will have the potential to carry 3,000 passengers per hour which will be critical to support the transport plan for the 2018 Commonwealth Games.”

Deputy Premier Jackie Trad said the second stage of the rail line would complete the missing link between Brisbane and the Gold Coast, and would provide an immediate boost to the construction industry with up to 1000 new construction jobs.

“The business case confirmed Stage Two will contribute an estimated $160 million to the Gross State Product and now we’ve selected the preferred contractor it is full steam ahead to deliver this project in time for the Commonwealth Games,” Trad said.

“Light rail has already transformed the Gold Coast, but Stage Two will provide a seamless journey for these passengers to move around the Coast and connect to Brisbane.

“This announcement sends a clear message that the Palaszczuk Government is getting on with the job of building infrastructure that will grow the economy and boost jobs.”

John Witheriff, chairman of stage one contractor and line operator GoldLinQ, said his company would work with CPB Contractors as it continued to refine its tender proposal.

“During this phase it is full steam ahead for CPB Contractors while they work on the detailed design for Stage 2, undertake survey work and site investigations and start recruiting their workforce,” Witheriff said.

“As part of the contract commitments made by CPB Contractors, they will engage with local workers and businesses to work on the project, which is great news for the Gold Coast community.”

The $420 million light rail extension is being delivered through a $270 million contribution from the Queensland Government, $95 million from the Australian Government and $55 million from the City of Gold Coast Council.

North Road level crossing in Ormond. Photo: Level Crossing Removal Authority

Level Crossing Removal Authority preparing Easter blitz

Victoria’s Level Crossing Removal Authority has announced a ramp-up in work at a trio of level crossings during the Easter break, to accelerate their removal.

The authority, part of the Department of Economic Development, Jobs, Transport and Resources, said last week it will use the Easter period  to knock off key chunks of work at level crossings at North Road in Ormond, McKinnon Road in McKinnon, and Centre Road in Bentleigh.

The Easter blitz follows an eight-day period of concentrated work which took place at the three crossings in late January.

All three crossing removals are under the same contract, held by a consortium of John Holland and KBR. The contract includes a fourth crossing, at Burke Road in Glen Iris, which had its boom gates removed earlier this year and is slated for completion by mid-2016.

Over Easter, construction crews will lay bridge decks at McKinnon and Centre roads, which the authority said will allow traffic to flow while the train line is dug underneath.

Meanwhile, demolition will begin at Ormond and McKinnon stations so they can be completely rebuilt. Bentleigh station will close in June for rebuilding as well.

The Level Crossing Removal Authority has informed residents of a series of bus replacement services for the train shutdowns that have to take place during the work, and have also arranged for road closures during certain stretches of the construction process.

According to the authority, the concentrated construction period over Easter will help crews have the crossings removed “months ahead of schedule”.

The removals are part of the Andrews Government’s plan to remove at least 20 level crossings by 2018, and 50 by 2022.

The funding plan for the significant removal program got a big boost earlier this week, with the State Government and Opposition agreeing to terms on the sale of the Port of Melbourne.

Danny Broad at Light Rail 2016. Photo: Oliver Probert

Opponents hate light rail, and then they try it: Broad

Australasian Railway Association (ARA) boss Danny Broad believes opponents of Canberra’s proposed light rail line will change their minds, should the project come to fruition.

Broad spoke at the Light Rail 2016 conference in Melbourne a week ago.

The relatively new ARA boss referenced the recent success of light rail around the country, citing – among other projects – the Glenelg extension in Adelaide, and the confirmation of funding for stage two of the Gold Coast Light Rail line.

Despite such successes, he said, “strong opposition to light rail proposals seems to be commonplace”.

“The Gold Coast [line] and Glenelg extension both faced strong media opposition until operation began,” he recalled, before pointing out that the Glenelg project boosted public transport patronage by 40% to and from Glenelg, with today’s line now carrying 20,000 people every day.

“The Gold Coast Light Rail is another success story,” he added, “with patronage exceeding expectations. In the first 14 days: 238,000 passenger trips.

“Stage two is obviously a must for the Commonwealth Games.”

Broad said the same criticism which plagued stage one of the Gold Coast project, and the extension in South Australia, is now dragging down enthusiasm over light rail in the nation’s capital.

“Canberra Light Rail still suffers from possible political intervention,” he noted.

“In becoming the ARA CEO, Canberra has recently become my home.

“The city was designed for light rail. The main avenues all have wide median strips that sit ready and waiting for Walter Burley-Griffin’s vision of rail.

“It’s also the most car dependant city in Australia. The ACT Government has invested more than a billion dollars in ACT’s roads over the last decade, without any public protest.

“And yet, the light rail proposal – like you’ve seen with other light rail projects around Australia – has attracted opposition.”

The Canberra Metro consortium was chosen as the preferred bidder to construct the project at the start of February.

Canberra Metro is made up of CAF, Deutsche Bahn, Pacific Partnerships, CPB Contractors, John Holland, Mitsubishi and Aberdeen Infrastructure Investments.

But the Territory’s Opposition has said that they will cancel the contract, should they come to power at the election later this year.

“I’m confident, like with the Glenelg extension, and Gold Coast Light Rail, Canberrans will soon be calling for phase two of the Canberra Metro project, as they realise the transformational capabilities of light rail,” Broad predicted.

ACT’s minister for Capital Metro, Simon Corbell, spoke after Broad at the Light Rail 2016 conference, and warned the Opposition of the dire consequences that might come from cancelling the project.