An amicable split? Breaking the privately financed upgrade of London's Underground into three packages looks increasingly likely.

surprise to those planning bids for the 7bn privately financed system upgrade.

Initially, there was an expectation that Railtrack could throw its balance sheet might behind the upgrade of the entire Underground system.

But it has become increasingly apparent that a three-package break-up of the network is the option most favoured by the Treasury and LUL bosses.

In simple engineering and operational terms there is much logic in Railtrack only bidding for the shallow Metropolitan, District, Circle and Hammersmith & City Lines.

Built in cut and cover tunnel around the centre of London and running on above ground track in the suburbs, the lines share the same gauge as the main line railways. Indeed, steam trains used the Metropolitan line to deliver cattle to Smithfield meat market right up until the 1960s.

Physical connections between the Underground's sub-surface lines and the main lines still exist at Kensington Olympia, Wimbledon, Richmond, East Ham and Upminster. Railtrack's maintenance gangs would be able to use these to run straight onto the Underground at night and would be able to work on the lines with minimal investment in equipment, using the same stone-blower and tamping machines as those used on the national rail network.

In the long term Railtrack has also hinted that it could carry out enhancement works to improve the integration of Underground and main line services. In production and engineering director Brian Mellitt's words, 'the synergies are right'.

Maintaining the deep lines which make up almost two thirds of the network will require a different set of expertise and skills. The gauge in the bored tubes is smaller, and specialised tunnelling skills are likely to be needed to carry out repairs and straighten tunnels for faster services in the future.

How the deep lines would be split into two further infrastructure packages is uncertain, although several theories are circulating. Some experts believe they would be best split in terms of age into one package of older lines needing a lot of work, and one where only rudimentary maintenance is needed.

Other observers claim the deep lines would best be split between routes running roughly north to south and those running from east to west. This could mean one package comprising the Northern, Victoria and Piccadilly lines, and one which comprises the Central, Bakerloo, Jubilee, and Waterloo & City lines.

'That would be the best way of doing it from the geographical location of the depots, and would give a fair mix of old and new rolling stock,' says one bidder.

For consultants and contractors interested in the privatisation plans, Railtrack's revelation is welcome news. With three prizes now expected, the mating game between those which have not yet formed consortia is hotting up - especially as three big rolling stock manufacturers, seen by experts as the vital element for successful bids, are still to be paired off.

Many remain confused about how LUL will manage its private upgrade. Bidders believe that LUL wants a greater degree of control over the day to day running of the project than is normal under Private Finance Initiative projects. This in turn could have a knock on effect on the eventual funding structures used by the winning bidders.

So will breaking up the Underground network be a good thing for passengers? There are, of course, the usual detractors who would prefer to see the network remain as a whole and stay fully in public hands.

But there are plenty of high quality companies lining themselves up to bid. If properly managed, competition between three packages should lead to improved services and opportunities for innovation.