Sydney Motorway Corporation (SMC), the team delivering major new underground highway connections for the city, has negotiated Aust$1.7 billion in private sector debt to complete funding requirements for the M4 widening and the M4 East twin tube highway tunnel sections of the city’s major WestConnex project.
The private funding facility is provided by Commonwealth Bank of Australia, Credit Agricole CIB Australia, ING, National Australia Bank, Natixis and Westpac Banking Corporation and involves a Aust$1.7 billion non-recourse five and seven year senior debt facility. It adds to an initial public funding contribution of $1.8 billion from the New South Wales State Government and a $1.5 billion grant and $2 billion concessional loan from the Australian Government. Public funding permitted work on WestConnex to start without waiting for full funding availability.
The private debt facility also supports a broader capital recycling strategy whereby Government equity can be sold down to fund future projects, effectively recycling the investment and delivering on a State Government priority for financing later stages of WestConnex. Toll revenue provides the balance of capital required.
“Almost a year ago to the day we secured Aust$1.5 billion in private sector finance for the new M5 highway project from major Australian and international lenders, so it is great to see market confidence in the full project remains high" said SMC Chief Executive Officer Dennis Cliche.
With excavation of the M4 East twin tube tunnels by the Leighton/John Holland/Samsung C&T JV progressing and work on the New M5 tunnel sections also underway by the CPB/Dragados/Samsung C&T JV, SMC has issued a call for expressions of interest in design and construction of the final Phase 3 M4-M5 underground link of the project.
“The M4-M5 Link is arguably the most important stage of WestConnex as it forms the vital connection between the upgraded M4 and New M5 to create a western bypass of Sydney’s CBD,” said Cliche. “In this call for expressions of interest, we are asking industry to put its most innovative ideas and designs forward to ensure we build the best possible infrastructure for Sydney.”
The Link will be delivered in two phases with the twin tunnels from Haberfield to St Peters built as a separate project from the Rozelle Interchange and Iron Cove Link. “By separating the project into two packages we can maximise efficiency and value for money through the design and construction contracts,” said Project Director Peter Jones. “The main tunnel works package is expected to include up to 9km of twin tunnels, associated ramps and supporting operational facilities with construction targeted to commence in 2018 and opening to traffic potentially in 2022. The Rozelle Interchange and Iron Cove Link works package is targeted to start in 2019 and open in 2023.”
Design of the Link is scheduled to be released for public consultation in January 2017, with the environmental impact statement released by mid-year.
WestConnex is currently Australia’s largest infrastructure project and will be the longest underground highway in the country. When complete, motorists will bypass up to 52 sets of traffic lights and average peak hour journeys between Parramatta and Sydney Airport will be reduced by up to 40 minutes.
The first sections of this world class project will start opening to traffic in 2017 including the King Georges Road Interchange upgrade which will fix one of Sydney’s worst bottle necks as they enter and exit the M5.
The M4 East contract is progressing well with more than almost a kilometre of the tunnel between Homebush and Haberfield excavated to date.
Tunnelling on the new M5 contract is also underway. CPB Contractors in joint venture with Dragados and Samsung C&T was selected as the preferred bitter for the $4.3 billion design and construct contract for the Stage 2 New M5 tunnel in September 2015 and work began in June this year (2016). The New M5 will run via 9km of twin tunnels from the existing M5 East at Kingsgrove to a new interchange at St Peters, more than doubling capacity between the Sydney CBD, Port Botany, Sydney Airport and the South West growth areas. The project is scheduled to open to traffic in late 2019. The final M4-M5 Link of the project is scheduled to open to traffic in 2023.