Monday, 2 March 2009

Tenders for Metro North to be lower due to falling costs

FOUR TENDERS for Metro North received by the Railway Procurement Agency (RPA) last Friday are likely to be substantially lower than anticipated because of an estimated 20 per cent fall in construction costs.

The project, known to have been costed at €4.58 billion in 2004, would directly create between 5,000 and 7,000 jobs and would represent “the type of economic stimulus that Ireland needs at the moment”, said RPA chief executive Frank Allen.

A preliminary oral hearing on the agency’s draft Railway Order for Metro North, an 18km mainly underground line linking Swords with St Stephen’s Green, opens today in Croke Park before Kevin Moore, senior planning inspector with Bord Pleanála.

More than 300 submissions have been made, mostly in support of the project, after the draft Railway Order was submitted to the appeals board last September, Mr Allen said. “It’s at an advanced stage of the planning process so now is the time to move ahead.”

Procurement of Metro North was also “at a critical stage”, with some 600 boxes of tender submissions from the four “preferred bidders” – Irish and international consortiums with experience of tunnelling projects. These are to be evaluated in the coming months.

“Value for money is far greater now than it was even a year ago,” Mr Allen said, adding that an index compiled by the Society of Chartered Surveyors showed that there had been a 20 per cent drop in construction tender prices.

After the four tenders are evaluated, he said the RPA would invite two of the consortiums to submit “best and final offers” in July, with a view to choosing one of them for submission to the Government by the end of this year.

Mr Allen explained that under the public-private partnership deal being contemplated by the RPA, Metro North would be paid for over a 25-year period.

He said each bidder would have spent €10 million on their tenders. “It would send an important message internationally if the Government decided to proceed without delay on the project. But it would be very damaging if it didn’t.”

There is concern that with the Government facing an €11 billion shortfall in the public finances, Metro North could be a casualty.

Irish Times

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