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Eurorail prepares to step in

EURORAIL WILL dump LCR's technical subsidiary Rail Link Engineering if it is successful in bidding for the Channel Tunnel Rail Link concession, it emerged this week.

Eurorail - which came second in the bid for the CTRL concession in 1996 - is furious at the prospect of LCR shareholders remaining involved in the project. Should Eurorail bid for the CTRL concession it is understood that the joint venture will choose not to take over RLE's expertise.

'It really is simply not on that the shareholders of a consortium that looks set to fail should continue to be involved,' said a source close to the consortium. Bechtel is as much a shareholder as Virgin and SBC Warburg. To suggest that traffic figures and revenue forecasts are not their patch is ridiculous.'

However, Rail Link Engineering, the joint venture of LCR's engineering shareholders, continues to stress that the technical aspects of the scheme have been sound to date. It has also made it clear to potential bidders that it wants to continue its responsibility for project management and design if LCR loses control in 15 days time (NCE last week).

Meanwhile LCR is already preparing to hand the project back to the government with only a skeleton staff. It is close to finalising talks with Deputy Prime Minister John Prescott on staffing levels for the project after an orderly run-down of the company.

'It looks as if the government wants to keep staff needed to obtain outstanding planning consents for the project,' said an LCR spokesman.

The number of staff working on planning consents at the moment was in the hundreds, he said, but added that the government had indicated that it wanted to retain only a proportion of the team. The Department of the Environment Transport and the Regions would say only that it was discussing all of LCR's assets, including staff.

In a separate development this week, Hochtief was named as the preferred bidder for contract 320, the £110M Thames tunnels, despite all negotiations necessary to sign exclusivity deals being on hold. A spokeswoman for LCR subsidiary Union Railways said: 'We were at a point where we were close to naming the preferred contractor so we finished the job.'

Hochtief managing director Les Forest only learned that his company had been named a preferred bidder when NCE contacted him for his comment. He said he was very surprised that a preferred bidder had been chosen at this stage.

Matthew Jones

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