The long-delayed M25 widening PFI deal has finally been signed, as NCE predicted earlier today, with work expected to begin shortly but cost increasing from £5.5bn to £6.2bn.
The Connect Plus consortium has reached financial close for the M25 widening PFI deal after securing an increase in its final value from £5.5bn to £6.2bn.
Under the deal, the M25 will be widened to four lanes between the M40 and A1, and the M11 to the A13 at Thurrock, in addition to the refurbishment of the A1(M) Hatfield Tunnel, and maintenance and operation of the M25, feeder routes and Dartford Crossing for 30 years.
Transport Minister Andrew Adonis said: “Today marks a major step forward in increasing the capacity of the M25.
“The widening schemes, combined with the maintenance and operation of the M25 network for the next 30 years, will reduce congestion, improve journey time reliability and safety and bring benefits to road users.”
The Highways Agency said work on both sections was due to be completed before the 2012 Olympics.
Up to 200,000 vehicles a day use the sections of the M25 that will be widened. The work is being phased to reduce the impact on road users and keep as many lanes open as possible.
Winning consortium Connect Plus is made-up from Balfour Beatty (with a 40% stake), Skanska (40%), Egis (10%)and Atkins (10%).
Atkins chief executive Keith Clarke said: “The network management, operations and maintenance services will call on our skills and expertise from more than 10 years of delivering similar services on behalf of the Highways Agency at other strategically important sections of the UK trunk road and motorway network,” he said.
“We are delighted Connect Plus has now reached financial close on this project which is the biggest single highways contract Atkins has ever won. It is critical to London’s transport infrastructure and builds upon Atkins’ core design expertise employed recently on similar schemes such as the M1 widening programme, and the M74 expansion in Scotland.
Atkins will provide the design expertise for the 63km widening programme.
Project funding settled today comed to £1.3bn, comprising £925M of senior debt provided by 16 commercial banks. There’s also a separate £185M facility from the European Investment Bank. Connect Plus shareholders will put in £200M of equity.
Connect Plus will subcontract operation and maintenance work to a joint vebnture between Balfour Beatty (52.5%) and Egis (15%), Atkins (32.5%). They will provide services in network management, asset inspection, traffic management, tunnel operation, incident management, routine and winter maintenance for the entire M25.
This covers a distance of 400km including a strategic network of feeder roads around London. Atkins will also be involved in the operation of the toll facilities at Dartford Crossing with the revenues being handed to the Highways Agency.