State would collect any Transmission Gully tolls

DAVE BURGESS
Last updated 05:00 04/12/2013

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If tolls are charged on the $1.3 billion Transmission Gully road they would be collected by the government, not the consortium contracted to build and operate the expressway.

It was announced on Monday that the Wellington Gateway Partnership (WGP), a public-private partnership, would enter into preferred bidder negotiations to build and operate the four-lane road for 25 years.

New Zealand Transport Agency spokesman Anthony Frith said no decision had been made on charging motorists a toll to use the 27-kilometre expressway from Linden to McKays Crossing near Paekakariki, scheduled to open in 2020.

"NZTA is currently investigating the need to toll Transmission Gully in order to assist in the payment of the construction and ongoing maintenance and operation of the road.

"The PPP procurement model to be used for Transmission Gully does not depend on tolling. If the decision is made to toll, the revenue will be collected by the NZTA and not the consortium that has been awarded the PPP contract."

The WGP is led by Australian company Leighton Contractors, owned by ASX-listed Leighton Holdings.

In a statement yesterday it said it expected the value of the Transmission Gully project to the company "to be in excess of NZ$800 million".

A key component of the project is the design and delivery of 29 bridges, a number of complex interchanges and the movement of more than six million square metres of earthworks. The road would also be built to high levels of seismic resilience.

Work is scheduled to start about July next year.

ACC is also part of the consortium. Spokeswoman Stephanie Melville declined to say what percentage share ACC is likely to hold in the WGP.

"But ACC expects to hold a significant proportion of the equity in the project."

ACC believes Transmission Gully is a good asset for its investment portfolio and would provide stable, long-term cashflows.

"ACC sees a natural alignment between its role as the national accident insurer and as part of a consortium committed to building a road with high and sustained standards of safety," Melville said.

Other WGP consortium partners are HEB Construction, InfraRed Infrastructure General Partnership and The Bank of Tokyo-Mitsubishi.

Transmission Gully is a key component of the 110-kilometre Northern Corridor Road of National Significance due to run between Wellington Airport and Levin.

Work started this week on another section of the corridor road, the Kapiti Expressway from McKays Crossing to Peka Peka.

The project will take four years to complete and would include 18 bridges, three million cubic metres of earthworks and 45 hectares of landscape and wetland planting.

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Frith said the project was expected to create 1000 jobs "based on actual fulltime equivalent job figures for very similar transport agency projects such as the Waikato Expressway".

An open day for Kapiti businesses to learn about possible opportunities created by the project is on Monday from 2pm at the Southward Car Museum.

- BusinessDay

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