Three shortlisted for £600m UK bridge

Consortia including Balfour Beatty, Bouygues, Macquarie Capital, Bilfinger Berger and Hochtief are in the running to build and operate a new bridge over the river Mersey.

Halton Borough Council last Friday announced a shortlist of three consortia to design, build, finance, maintain and operate a new bridge over the river Mersey, in the Liverpool region. The three consortia are:

A team of Balfour Beatty, Bouygues and Egis;
The Merseylink consortium, including Macquarie Capital, Bilfinger Berger, Vialia and FCC;
The MGL consortium, comprising Galliford Try Investments, Hochtief and Iridium.

Rob Polhill, leader of Halton Borough Council, rejoiced at the shortlist for the bridge PFI. “We have attracted world class construction groups that have come together to compete for this prestigious contract. I look forward to announcing the eventual winner and the commencement of construction later next year.”

The Mersey Gateway project is widely seen as one of the last big contracts outstanding in the UK’s existing Project Finance Initiative (PFI) pipeline, with a construction cost estimated at £600 million (€720 million; $951 million). Lifecycle costs for the 30-year contract will total circa £40 million, with operations and maintenance costs estimated at roughly £12 million a year. The project is set to start construction towards late 2013 with a scheduled opening in 2016.

The bridge contract came together last October, when the local procurement authority agreed to accept £470 million in funding – and attached conditions – being provided by the UK’s Department for Transport (DfT). The latter had said that the money was contingent on Halton Borough Council reducing the project’s cost by £30 million, or 5 percent of its value.

The vast majority of the DfT’s contribution – about £385 million – will be used to help fund some 26.5 years of availability payments. Even though the new bridge will be tolled – and the winning consortium will be responsible for managing toll collection of some £1.50 per car – the concessionaire will be remunerated via public contributions paid in exchange for making the bridge available in good condition. The rest of the grant will be used to fund land acquisition.

The Mersey Gateway Bridge will cross the river Mersey between Runcorn and Widnes. It is located 1.5 miles from an existing bridge – the Silver Jubilee Bridge, also tolled – which will now be restricted to certain types of traffic.