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Single contract DBFO for M25 widening

WIDENING OF the remaining 106km of three lane dual carriageway section on the M25 is almost certain to be let as a single £1.5bn privately financed DBFO contract, the Highways Agency said this week.

Procurement director Steve Rowsell confirmed that the Agency was in final discussions with the Treasury about the project following July's Comprehensive Spending Review.

The Agency hopes to make a formal announcement by the end of the year.

'It (Treasury) wants to be satisfied on value for money. We believe that it is, ' said Rowsell.

Once the Agency has Treasury backing it will give the industry six months to form consortia ahead of formal tender.

This would keep the project on schedule for a 2007 start, as set down in the Agency's Targeted Programme of Improvements (NCE 22 April).

Rowsell confirmed that a payment mechanism including penalties for slow journey times is likely to be used, similar to that being used on the £245M A1(M) Darrington to Dishforth scheme (NCE 24 June).

But he added that the Agency would consult with industry to find an acceptable level of risk transfer.

'The risk of congestion is substantially greater on the M25 than the A1(M), ' said Rowsell.

'But the fundamental principle of incentivising a good service to the road user by maximising availability and free flowing traffic is something we will wish to encourage.'

Rowsell added that the project will use a new DBFO contract that will incorporate the principles of its Early Contractor Involvement contract and will also use a process that will minimise the cost of tendering.

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