LONDON & CONTINENTAL Railways is considering plans to split construction of the Channel Tunnel Rail Link into two phases in an attempt to get around its funding crisis, it emerged this week.
LCR could also ask Railtrack to take it over or at least buy a controlling interest in the project, according to one option now under consideration.
Building the link in phases is similar to one option due to be considered by the Railtrack board at a meeting today.
Two-phased construction would mean building the easiest, southern, section of the link first and leaving the expensive tunnels under north and east London until traffic started to overload Waterloo International. LCR originally rejected this as it believed a connection to the west coast main line via north London was vital to the success of its plan.
But it is now considering the option as part of its battle to come up with a plan to keep the project alive after failing to win an extra £1.2bn of public money for the project two weeks ago (News last week). LCR has until 27 February to come up with a rescue plan. If it fails the government has the options of taking the project over, scrapping it or putting it out to tender.
If the phased construction is adopted, LCR will have to renegotiate the terms under which it receives the £1.8bn public subsidy already earmarked for the project. The CTRL concession agreement says this money is to be released in two annual chunks when 68% of the link is built.
But some of this money is intended to pay for the provision of commuter train paths on the section between Ebbsfleet and St Pancras. The rest is partly justified on the grounds that the link will help regenerate Ebbsfleet, Stratford and St Pancras.
As a result LCR is considering whether to ask for the money to be released in stages over a number of years ahead of the construction of the London tunnels.
Railtrack said this week that it would only get involved if the loss- making Eurostar was taken out of the concession. A spokeswoman said it would consider buying LCR, but said it would be more interested in taking over the project without the existing shareholders - Bechtel, Halcrow and Ove Arup, Virgin, National Express and Systra.
If the government rejects LCR's plan, Railtrack could take over the project without having to tender for it if no other bidders come forward.
But this week a re-tender looked increasingly likely after Eurorail confirmed its interest the project. Eurorail is the Kvaerner/BICC consortium which came second in the original competition for the link. It said it would tender for the whole CTRL and run Eurostar if LCR failed to hang on to the project.