COMPANY NEWS SELI and Coastal form subcontinent alliance Mar 2011
Shani Wallis, TunnelTalk
- India construction company Coastal Projects Limited and Italian TBM tunnelling specialist SELI have signed an agreement of exclusive mutual cooperation for the booming TBM tunnelling market on the Indian subcontinent.
- Through the agreement, SELI will assist Coastal with services and supplies for its three existing TBM projects in India, supply Coastal with technologies, knowhow and TBMs for coming tunnelling projects, and provide the necessary experience for the alliance to prequalify for new projects in India's potentially vast TBM tunnelling market. In return SELI will secure a turnover equal to 34% the value of these TBM projects.
- To seal the deal, Coastal has bought a 26% share in SELI from previous minority holders for Rs 108 crore (about €18 million). Coastal will profit as a shareholder by providing work and turnover in India to SELI and boost its share value.
- After the 26% entrance of Coastal, Remo Grandori, owner and chairman of the company started by his father in the 1950s, retains the majority share, with another 15% owned by an equity fund managed by Intesa SanPaolo Bank.
- In a statement to TunnelTalk, SELI explained that "Coastal was looking for a specialized TBM contractor to help it operate TBM tunnelling projects more efficiently. In addition and from SELI's prospective, Coastal's knowledge and understanding of the local market will secure SELI with more and better opportunities than SELI could achieve by itself."
- "The Indian subcontinent is a huge market for TBM projects in the next 10-15 years, probably even larger than China," continued the statement. "Coastal, as one of the most active Indian contractors in general, and more specifically in the tunnelling market, are negotiating many TBM tunnelling projects in the water, hydropower and road sectors."
Site assembly of the Robbins TBM for the 19.2km Veligonda 2 drive
- According to the statement, the cooperation does not restrict SELI from supplying TBMs and services to other Indian contractors for projects where the partners decide not to participate under their industrial agreement.
- Coastal, is a Hyderabad-based construction company that was incorporated in 1995 and has a reported portfolio of more than US$2 billion of construction contracts in hand. Among them are its three TBM contracts - the parallel 19.2km long, 7.8m and 10m diameter Veligonda 1 and 2 water transfer tunnels from the chain of Srisalem reservoirs near Hyderabad in Andhra Pradesh, and the 12km long x 9.2m i.d. segmentally lined Slemanabad tunnel for the Bargi Diversion Project in Madhya Pradesh near Juabulpur in southern India. It is also the low bidder for the second contract of 3.3km of running tunnels and two underground stations on the new metro system in Bangalore.
In the two months since signing the agreement, the companies
• have submitted a joint offer to prequalify for future tunnelling works on expansion of the Delhi Metro;
• have agreed technical assistance to recover Coastal's Veligonda 1 water transfer tunnel were the contract's 7.8m diameter Herrencknecht double shield TBM is at a standstill for more than a year in extremely difficult geological conditions;
• are negotiating the scope of SELI's services and supplies to Coastal's two other current water transfer TBM tunnelling contracts at Veligonda 2 and Sleemanabad where Robbins double shield TBMs are procured for the contracts and one is making slow progress in difficult geology on Veligonda 2;
• are awaiting award of the Bangalore metro contract to Coastal to start cooperation in that project.
- In addition Coastal and SELI are pursuing an estimated €10 billion scope of work in planned metro, road and water projects that to be tendered or negotiated in the near future in India. They have also agreed to work together in South Asia.
- For SELI, the agreement comes in the wake of its industrial agreement signed last April with Japanese TBM manufacturer Kawasaki. This has the two companies cooperating in Europe and North and South America in the manufacture and development of EPBMs.
- The deal also broadens SELI's international presence and adds to its portfolio of about €800 million in current tunnelling work divided evenly according to the statement, between Europe, the Americas and Asia. In India, SELI is working on 14km of the 23.5km long Kishanganga headrace tunnel as a tunnel systems supplier and subcontract to HCC and bid for contracts on the Chennai Metro in JV with HCC and SB.
SELI's Kishanganga TBM ready to ship to India
- This is in addition to two major projects in Panama; metro projects in Italy; and the tunnelling works as part of an all-Italian consortium for the Cityringen metro project in Copenhagen. Coastal bid the Chennai work in JV with GYT.
- Through its experience as a contractor and designer and manufacturer of TBMs, SELI claims 700km of bored tunnel and more than 100 TBM projects completed successfully, some under the most difficult geological situations. Through the years it has established a reputation as being able to assist the rescue of TBMs battling extreme conditions. One of its recent successes was completion of the Beles II hydro headrace tunnel through extremely difficult conditions and situations in Ethiopia.
- Coastal claims 75km of tunnelling completed with another 250km under construction. The Veligonda 1 and 2 tunnels are on the left bank of the Srisailem reservoir where the the 7.8m Herrenknecht and 10m diameter Robbins double shield machines are advancing parallel 19.2km long tunnels to deliver water to the Prakasam, Nellore, and Kadapa districts of Andhra Pradesh. The contractor for each project respectively is NSL-SEW-Sabir-Coastal Projects JV and HCC-Coastal Projects JV.
- Another 10m diameter Robbins EPB machine is being used by Coastal on its 12km long x 9.2m i.d. segmentally lined Slemmanabad water tunnel on the Bargi Diversion Project in Madhya Pradesh State near Juabulpur about 800km north of Hyderabad.
Current and planned tunnelling activity in India - TunnelTalk, July 2008
Robbins TBM site-assembled for India's Veligonda 2 water tunnel - TunnelTalk, July 2009
Underground advance for Bangalore Metro - TunnelTalk, July 2010
SELI-Kawasaki extend collaboration - TunnelTalk, August 2010
SELI set for tough drive on Kishanganga - TunnelTalk, May 2009
Prequalifiers line up for Chennai Metro works - TunnelTalk, July 2010
EPBM push by SELI in Panama - TunnelTalk, February 2011
Metro breakthrough for SELI in Rome - TunnelTalk, September 2010
Four EPBMs selected by SELI for Cityringen - TunnelTalk, January 2011
Success after mammoth struggles in Ethiopia - TunnelTalk, November 2009
SELI celebrates 60 years in business - TunnelTalk, May 2010
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