[Article] SBP - Metro North bid tenders to be received this week

[Mark Hennessy]

Business Post (not online yet) has a small piece stating the 4 bidders are submitting bids this week.

Cost is expected to be in the €3-€4bn range and raising finance will be very hard.

[Mark Gleeson]

Originally Posted by Mark Hennessy

Business Post (not online yet) has a small piece stating the 4 bidders are submitting bids this week.

Cost is expected to be in the €3-€4bn range and raising finance will be very hard.

Metro North rail bids due this week
Sunday, February 22, 2009 By Nicola Cooke
The four consortiums vying to build the Metro North rail system in Dublin are finalising their bids and will submit them to the Railway Procurement Agency (RPA) this week. The Sunday Business Post understands that the consortiums have focused on reducing costs where possible, and that bids are expected to be in the region of €3 billion to €4 billion. Sources confirmed that the drop in property prices, and competition among subcontractors for work, had allowed them to revise costings downwards.

Sources close to the consortiums said that the technical and financial aspects of the bids had been stressed as the main points on which a decision would be made. The sources said that the government had reiterated that the project was not in danger of being scrapped.




Transport minister Noel Dempsey has said that the government supports the project, but that it must represent value for money in the current economic climate. The minister said that capital investment projects that generated employment in the construction sector were a priority, and that the rail project should generate several hundred jobs.

However, raising private capital to fund the 17-kilometre link between the city centre and Swords is likely to be challenging for the consortiums. This is expected to be a significant factor in the RPA’s selection of the final offer over the coming months.

The RPA is expected to examine the bids over the next month, before meeting the individual consortiums for briefings and questions on their submissions.The bidders will be given time to elaborate on technical details or variations in their project designs.

The four consortiums are Dublin Express Link, which includes SIAC,H SBC and French Metro operators Keolis; Cathro Consortium,which includes Luas operator Veolia and Siemens; Metro Express, which includes AIB, Transdev and Sisk; and the CelticMetro Group,wh ich is composed of foreign operators and headed by Tokyo-based investment groupMitsui.

http://www.thepost.ie/post/pages/p/s...765-qqqx=1.asp

[Mark Hennessy]

And in todays Irish Times:

http://www.irishtimes.com/newspaper/...242083966.html

FOUR TENDERS for Metro North received by the Railway Procurement Agency (RPA) last Friday are likely to be substantially lower than anticipated because of an estimated 20 per cent fall in construction costs....

[essoII]

Anyone see enda kenny's opinion letter in the Irish Times sometime last week? Absolutely shocking, he was ranting on about what he'd do if he were Taoiseach. He said that he'd immediately shelve Metro North as many current public infastructure projects that current government are going ahead with are going to further damage the economy under the current economic climate...almost makes Fianna Fail look attractive again, Kenny's a gob****e in my opinion. 7000 guaranteed jobs will be created in constructing the metro. Construction's going to last what? 5 years? we'll be out of the recession(hopefully) by then and with a much more effective public transport system in Dublin. Wasn't a major mistake in the last recession not investing more heavily in large public transport projects?



*Edit* actually here's his opinion piece if anyone wants to read it:http://www.irishtimes.com/newspaper/...241892788.html

[sean]

Agreed, I was quite disappointed by that part of Indakenny's piece. Delay Metro North (while supporting the Western Rail Corridor all portions) ... my opinion of Fine Gael just went down about 6 points.

[markpb]

Originally Posted by sean

Agreed, I was quite disappointed by that part of Indakenny's piece. Delay Metro North (while supporting the Western Rail Corridor all portions) ... my opinion of Fine Gael just went down about 6 points.

Ditto. I've never been a huge fan but I voted for them in the last election because they've got to be better than the current shower. Writing off a vital piece of infrastructure just dropped them to the bottom of the pile.

[Mark Gleeson]

Never had time for Enda

Metro North is the ultimate get out of jail card. Up to 7000 jobs in the construction/engineering/architecture business. And state pays nothing until the day it opens in 2015. Prices are down up to 20% so the PPP availability payments are down. Hopefully we can find 150 million a year in 2015,

The accrued benefit to the economy by having metro north is going to be a very large number, much bigger than the PPP availability cost. Irish Rail is worth about 1 billion per annum

[Colm Moore]

Originally Posted by Mark Gleeson

Hopefully we can find 150 million a year in 2015,

Hmmm, fares alone don't bring in all that much - 40,000 passengers per day x 365 days x €2 = €29,200,000 (of course, if its 80,000 passengers per day x 365 days x €2 = €58,400,000 - a much nicer figure)

There are of course other revenue streams - section 49 development contributions, advertising, mobile phone site hire (the existing networks aren't able to penetrate through 30m of rock and soil), retail oppurtunities, car parking fees.

[ThomasJ]

Originally Posted by essoII

Anyone see enda kenny's opinion letter in the Irish Times sometime last week? Absolutely shocking, he was ranting on about what he'd do if he were Taoiseach. He said that he'd immediately shelve Metro North as many current public infastructure projects that current government are going ahead with are going to further damage the economy under the current economic climate...almost makes Fianna Fail look attractive again, Kenny's a gob****e in my opinion. 7000 guaranteed jobs will be created in constructing the metro. Construction's going to last what? 5 years? we'll be out of the recession(hopefully) by then and with a much more effective public transport system in Dublin. Wasn't a major mistake in the last recession not investing more heavily in large public transport projects?



*Edit* actually here's his opinion piece if anyone wants to read it:http://www.irishtimes.com/newspaper/...241892788.html

Bruton would do much better as taoiseach than kenny, its a pity FG dont seem to have another Finance minister as experienced as Richard Bruton.

[Mark]

The €770 million price tag for Luas was always intended as a capital investment and the running costs would be covered by the fare box ie no subsidy.

I think its the same with Metro North. Its an investment that is never expected to pay back its capital cost but rather cover operating costs plus more.

Indirect social costs are different though along as the savings in congestion etc.

[Colm Moore]

Of course. The IDA submission is rather brief, but their main point is that MN will improve quality of life.

[Mark]

I can see it kickstarting development (albeit not at the same rate) in many areas in Fingal.

I wish FF would point out the benefits of actually going ahead with it.

[Mark Hennessy]

"Leading" "economist" Sean Barrett called for Metro and Interconnector to be dropped from proposed capital spend on Morning Ireland.

[Mark Gleeson]

Wouldn't pay any attention to him, he doesn't even understand that Metro North is not a capital spend in the first place

[Mark Hennessy]

Originally Posted by Mark Gleeson

Wouldn't pay any attention to him, he doesn't even understand that Metro North is not a capital spend in the first place

I know that, but given that the country is up the Khyber and politicians are weak and useless at the best of time, the public percerption is the most important thing at the moment and fancy underground trains are not going to win FF any votes in the short term

[comcor]

Personally, I don't see that Metro North is all that vital a piece of national infrastructure. It certainly doesn't compare to the Interconnector.

There are cheaper ways of connecting to the airport and Swords and it's questionable if Dublin's northside has a population density that can justify a metro rather than a LUAS.

PPPs are a scam. They're just a way of keeping borrowing off the national balance sheet. In some ways they are to infrastructure what CDSs are to the housing market.

The arguments that it will spur development in Fingal carry as much weight as arguments that the WRC will bring development in the West. There will be no development in this country for the next 5 years.

[markpb]

Originally Posted by comcor

The arguments that it will spur development in Fingal carry as much weight as arguments that the WRC will bring development in the West. There will be no development in this country for the next 5 years.

If the metro was only around for five years, that would be a valid argument but for something that should be operating in 100 years, what difference does the next five years make?

Likewise, if the metro is built, there's nothing to suggest large parts of north Dublin couldn't be rebuild to higher density. High density doesn't get built before mass transit - it get built with or after it.

[Mark Gleeson]

I'm no fan of PPP's due the overall cost being greater but

No risk to the taxpayer, everything is fixed up front
Solves a massive problem on the Northside and will probably promote development up there, thus generating employment
Cost spread over 25 years as a non capital cost
Doesn't impact on the national debt
If the service doesn't meet the contract standards, the PPP payment is reduced

Interconnector is going to be PPP as well

[ACustomer]

Much as I would like to see these projects go ahead, there are really big problems related ulitmately to the state of the public finances.

Sure, there is no up-front cost, but there is a future liability, and capital markets in their present mood are going to be very sensitive to this. In particular, the developers/private partners are going to have to borrow several billions from banks or bond markets: how do you rate their chances? How high wil the borrowing costs be?

PPP puts what is effectively a Public Debt (i.e.liability) off-balance sheet i.e.the thing does not appear in the published National Debt total. Putting stuff off balance sheets is what has got the world into such a mess recently!

[Mark]

With regard to any calls by posters here about which project should go ahead at the expense of another etc then remember that metro North is at the most advanced stage of any of the other large PPP projects like Metro West, the Interconnector and Lucan Luas. The likes of the IC, MW and Line F would be at least 1 year if not 2 away from An Bord Pleanala which is where MN is at now.

If they were to delay anything they should start with the least advanced in my opinion and simply for the fact that we need a large infrastructure project to kick start employment and the Metro north is the only one that can start any time soon.

*When I mean delay I mean delay construction. Planning and design should proceed as scheduled. Its small change when it comes to construction.