SA government to not proceed with GlobeLink

The South Australian government has terminated the GlobeLink project.

The proposed project would comprise a road and rail corridor behind the Adelaide Hills, which would connect the National Highway and the rail link from Victoria to Northern Adelaide. The project would have also included an intermodal export park and freight-only airport at Murray Bridge.

The SA government commissioned KPMG to produce a business case for the project, which found that rail freight in the corridor would decline.

Minister for Transport, Infrastructure and Local Government, Stephan Knoll, highlighted that investment in rail freight would not be of economic value for the state.

“Particularly, with respect to the rail component, the report highlights that limited and declining volumes see limited relative economic benefit for the state,” he said.

“Therefore, with rail volumes unlikely to increase sufficiently in the future, the benefits of a new rail corridor are very marginal.”

The KPMG report found that the benefit cost ratios for the initial rail corridor is 0.08, a value of 1 is where a project would break even.

The report highlighted that while rail freight on the Perth – Melbourne route will grow by 1.9 per cent, in the Adelaide – Melbourne corridor rail will remain flat.

“Since the last investigation into an alternative rail alignment undertaken in 2010 (The Adelaide Rail Freight Movement Study), demand has been more subdued than previously estimated and capital costs have increased.”

The report recommended that increases to productivity should focus on existing road and rail corridors, and that the state government support a market-led approach for increasing intermodal capacity to the east of the Adelaide Hills.

“The report does highlight that the intermodal export park could provide improved connectivity and economic benefits to the state, however that would also have to be driven by private sector investment at that site,” said Knoll.