Coronavirus pandemic pauses many projects 26 Mar 2020

The number of Covid-19 infections continues to rise, as forecast by models. In line with major public efforts to reduce transmission of the virus, progress on many major tunnel projects in numerous countries have been shut down or paused. These include the Brenner and Lyon-Turin baseline rail tunnels in the Alps, the Milan Metro, and the Crossrail and Tideway projects in London. As part of widespread orders for many business sectors to close, it is creating tremendous uncertainty for business and the public worldwide.

The actions come as India goes into a complete lockdown of its 1.3 billion population and as the number of cases grow dramatically in New York and Los Angeles and other parts of the USA.

Lyon-Turin base line alters work plans and keeps procurement going

This is set against the backdrop of positive news from China that there has been no increase recently in the number of confirmed virus infections from domestic contacts in China, where the outbreak originated. Isolation regulations are being relaxed and Chinese infrastructure construction companies are reporting a resumption of activities on projects, including by the China Power Group resuming tunnelling works on many sites for the Shenzhen Metro Line 12.

As business sectors and projects beyond China act rapidly, state-backed financial aid packages, of unprecedented amounts, are being agreed to support businesses and workers in different nations. Amid intense discussions between governments, their political opposition parties, the business sectors, and advocates for workers, many are referencing each other to explain or justify decisions being made. In many countries, small businesses and self-employed workers, many of whom work in the general construction sector, remain effectively uncovered.

Amidst it all, as events move swiftly and facts are sought on all fronts, there remains shock and disbelief at the speed and spread and impact of the virus to health, livelihoods and economies. While the experience and impacts are lived locally, the perspectives taken are international and shared as government and millions of people seek to protect and survive.

Guidance on the pandemic from FIDIC
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In these uncertain times, decisions are being made on events and projects by the industry and clients.

As previously reported, the WTC World Tunnel Congress for 2020 has been cancelled in May and rescheduled to September. The next major industry conference and exhibition, NAT, North American Tunneling, remains on schedule for 7-10 June in Nashville in the USA although the organiser is monitoring developments and has extended its refund deadline to 26 May. Another international congress postponed by a year is the International Infrastructure Conference that was scheduled for 13-15 September.

Transport for London (TfL) instructed its various project sites, including the Crossrail project and station upgrade project to temporarily shut down to a safe stop status. Essential operation of services as well as maintenance of the London Underground system would continue although in a statement, Mike Brown, London Transport Commissioner, said “it is vital that the transport network is only used by critical workers” with all other commuters and regular passengers required to stay at home. He added: “As we work through these issues with our supply chain, consideration will be given to the impact on workers, particularly those who are on low incomes.”

The London Tideway sewer project has also geared down further. In a statement to TunnelTalk, Tideway said: “To ensure we can undertake all activities safely, we have temporarily reduced activities across the Tideway project with only safety-critical and essential work continuing at the present time. Strict health and safety measures are in place to protect those who are continuing to work. We have also taken steps to support our supply-chain during this uncertain time.”

Also in the UK, EDF Energy is reducing the 4,500 workforce at its Hinkley Point C nuclear plant project by more than half to about 2,000. EDF said that the remaining skilled workers will focus on critical areas and work in shifts with extra transport and staggered breaks to minimise contact. This will compound reports of repeated delays and rising costs to £22.5 billion. The 3.2GW plant with its cooling water intake and outfall tunnels, being built by EDF with China General Nuclear Power Corp, was expected to begin generation at the end of 2025.

Tideway gears down due to coronavirus

The UK Government however, has been criticised in leaving it to project managers to decide to close down construction sites, or continue operation, while adhering to social distancing directives. Graham Watts, CEO of the UK Construction Industry Council (CIC), said that while mixed messages from the Government have led to a sense of mess and muddle, the problem does not have a binary simple close or stay open solution. “It would be incredibly dangerous for all construction sites to close,” he said but “not all construction work is essential,” and he urged the Government to get clear on what are essential projects and what are not.

To assist its members, FIDIC, the International Federation of Consulting Engineers, has published a guidance on the impact of the pandemic.

The USA in its multi-level rescue package for business and workers seems to be tackling a full spectrum of needs promising a payout to every adult. Within the US$2 trillion financial aid package approved by the Senate and the White House, water management companies across the country have signed a petition to Congress to assist many water and waste water systems that are experiencing steep revenue losses as a result of the widespread shutdown of events and businesses that have essentially frozen large parts of the economy – causing revenue losses of $10 million and more for the companies, and placing in jeopardy ongoing and essential maintenance and repairs. Loss of revenue is also a major concern for the public transport buses, railway and metros that have dramatically reduced services and as regular commuters and passengers stay at home.

Project suspensions

Among projects that have suspended progress are some of the largest tunnel projects of Europe.

Developer of the Brenner Alpine rail project on the Italian-Austrian border, BBT-SE, announced late last week that work is temporarily suspended except for activities necessary for the safety of partially completed works.

Work plans on the Lyon-Turin rail project on the Italian-French border are being modified with the client, TELT, reorganising activities at its six main construction adit sites including Saint-Martin-La Porte; La Praz, where a TBM is being dismantled; Saint-Jean-de-Maurienne; and has stopped works at the Saint-Julien-Montdenis portal in France. Only maintenance and safety activities continue, and an emergency committee is managing those decisions. TELT said all workers and staff on the project remain virus free and that the various sites would restart at full capacity as soon as the critical phase of the contagion is over. With procurement activities underway for award of the main tunnel excavation contracts, TELT confirmed that these activities are continuing via conference calls.

Norway cancels Kleverud-Sørli rail link procurement and continues with others

In Italy, one of the countries impacted hardest by the pandemic, works on the Milan Metro Line 4 has been suspended along with many other construction sites in Italy.

In Norway, the fallout to plans to handle the virus, has seen the national rail authority, Bane NOR, cancel the tender process for the excavation contract on the Kleverud-Sørli project, to be rescheduled once the effects of the virus on the programming of projects is known. Also in Norway, the opening ceremony of the full Ryfast road project in Stavanger has been delayed following the opening of the 14.4km long subsea tunnel in January.

In Austria, Strabag has moved to part-week working in response to the virus. The short-time working arrangement was announced at the end of last week and initially applies for three weeks. In a statement, Strabag CEO Thomas Birtel said: “The Government, responding in part to public pressure, has worked out a solution that is acceptable and reasonable for all involved. The spectre of across-the-board layoffs is thus off the table.” He added that the arrangement “safeguards the most jobs, is the most efficient way to ensure the continued existence of the company, and, despite the inevitable loss of income, offers a far better financial situation for all of our colleagues than normal unemployment benefits.”

At the end of last week also, Implenia announced limits to its construction activities in Switzerland, Germany, France and Austria with its activities in Nordic countries continuing as normal until further notice.

As Vinci noted in its statement this week, the virus containment measures put in place by the French government has led to suspension of most works on a large number of projects, stating that “industry organisations have held talks with the public authorities to define conditions under which works can resume gradually while ensuring the health of those involved.”