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Jan 28, 2005

SA toll-road developer secures Hungary concession

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© Reuse this South African toll and motorway facilities developer, Intertoll, a wholly-owned subsidiary of JSE Securities Exchange-listed construction company Group Five, has secured yet another European project: the operation and maintenance of a 58-km stretch of the M6 motorway in Hungary over a 20-year concession period.

The deal was preceded by the signing last August of a 35-year concession contract to operate the new A1 Gdansk–Torun Motorway in Poland, says Intertoll MD Tim Woodhead.

This is in keeping with the com-pany’s strategy, as it aspires to move from an existing base into both emerging and established markets, especially in Europe, where there are numerous tolling projects.

The concession for the M6 project was signed in October and attained financial closure in December, breaking new ground in the European industry, as the entire process from prequalification of prospective bidders to financial close by the appointed concessionaire was finalised in a year, rather than the conventional period of two to three years, explains Woodhead.

He attributes this feat to Hungary’s strong political will to develop its motorway network and the Department of Transport’s decade of experience with toll-road concessions.

Construction of the first phase of the M6 motorway is scheduled for completion in March 2006. Operating the motorway is expected to provide Intertoll with a turnover of between €2-million and €3-million a year.

The controlling shareholder of the M6 concession company is Bilfinger Berger, Germany’s second-largest construction company.

With regard to Intertoll’s prospective contract in Poland, the com- pany became involved with the project in 1997, shortly after initial concession rights were awarded to Gdansk Transport Company (GTC). GTC is currently pursuing financial closure, which is targeted for the end of April.

Closing this project will be a significant achievement for Intertoll as it will increase the company’s European presence, says Woodhead.

Even though the project funding may only be finalised in April, a risk-sharing arrangement between GTC and the Polish government has made provision for the progression of the design work.

The project cost will be some €700-million and involves the construction of a new dual-carriageway motorway, which will extend 90 km from the port of Gdansk, Poland’s main port on the Baltic sea, south towards the town of Lodz and will, in a later phase, intersect with the A2 Motorway that connects Berlin to Warsaw.

Woodhead tells Engineering News that the Polish government is also ultimately considering the extension of the A1 to the Czech Republic.

Currently, there are other existing roads, but these are much smaller, single-carriageway routes with relatively high accident rates.

The construction joint venture is being led by Swedish construction group Skanska.

During the construction phase, scheduled to begin in mid-2005 and be completed in 2008, Intertoll will be providing the tolling facilities and maintenance centres.

It will also be procuring the motorway’s operating equipment, which includes snow-clearing equipment, summer maintenance equipment, accident management and route patrol vehicles, says Intertoll’s European Commercial Director Uwe Sauerburg.

Intertoll will employ a permanent staff complement of 150 and is also investing some R50-million in the concession.

Initially a significant component of the input will be from South African engineers and commercial staff, but the company will also be drawing on expertise from its Hungarian staff, where Intertoll has been operating since 1996, adds Sauerburg.

The company has also undertaken some consulting work in Germany on the Herrentunnel in L
Edited by: elizabeth rebelo
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