Signing of N8 Rathcormac/Fermoy Bypass PPP Contract
21st June, 2004
Signing of N8 Rathcormac/Ferrmoy Bypass Public-Private Partnership Contract
The Minister for Transport, Mr. Seamus Brennan, TD, today 21st June 2004 announced the signing by the National Roads Authority (NRA) of the contract for the N8 Rathcormac/Fermoy Bypass. This is the NRA's third major inter-urban Public Private Partnership (PPP) scheme contract award during the current National Development Plan 2000-2006 (NDP).
The successful consortium, Direct Route (Fermoy) Ltd. was awarded the contract following a competitive tendering procedure. The consortium comprises Kellogg Brown & Root Ltd, Strabag AG, John Sisk & Son (Holdings) Ltd, Lagan Holdings Ltd, Roadbridge Ltd. and the First Irish Infrastructure Fund (a joint AIB/European Investment Bank fund established for the purpose of investing in PPP projects and private sector infrastructure developments in Ireland and across Europe).
The N8 Rathcormac/Fermoy Bypass is a strategic section of the N8 Dublin-Cork road corridor and is part of the priority Trans-European Road Network. The scheme comprises 17.5 km of motorway together with associated interchanges and local road realignments and includes a 450 m long viaduct spanning the Blackwater Valley. The new section of road will greatly alleviate traffic congestion in Fermoy when it opens in mid 2007.
The terms of the PPP contract provide that the consortium will construct and operate the N8 Rathcormac/Fermoy Bypass scheme through a Design/Build/Finance/Operate arrangement. This will encompass a concession period of 30 years during which the consortium will recoup a portion of the upfront design and construction costs and on-going operation/maintenance costs through the collection of tolls. The consortium will also have to invest in the road prior to handback to the State to ensure it has a satisfactory residual life.
The banks providing debt to the project are KBC/IIB, AIB, ING along with the European Investment Bank. The companies constituting the consortium are also investing capital in the project as is the First Irish Infrastructure Fund. The private finance drawn in by the PPP mechanism ensures earlier delivery of important national road schemes and increases the scale of road construction activity above what would be possible through reliance on Exchequer funding alone. Furthermore, in keeping with the principles of PPP, significant risks associated with construction and operation, and with future traffic levels have been assigned to the private sector.
The NRA acknowledges the key role of Cork County Council in developing this scheme and progressing it through the statutory process and also its role in liasing with landowners and utility companies. The NRA is also pleased that the European Investment Bank is investing funds in this infrastructural project as it has in the first two – N4/N6 Kilcock-Kinnegad and M1 Dundalk Western Bypass PPP inter-urban motorway contracts.
The N8 Rathcormac/Fermoy Bypass scheme is one of eleven PPP projects identified by the NRA as part of the overall strategy to deliver the national roads element of the NDP. The NDP sets a target of securing private sector finance of €1.27 billion to supplement Exchequer and EU investment in the national roads programme, thereby increasing the scale of the programme and accelerating the commencement and completion of projects. With the signing of the N8 Rathcormac/Fermoy Bypass PPP contract, four PPP contracts (inclusive of the second West-Link Bridge) have now been entered into and €500m of private finance introduced into the programme.
Two new PPP contracts have been advertised i.e., the 10 km Limerick Southern Ring PPP scheme (incorporating a 900 metre length immersed tube tunnel under the river Shannon) and the M50 upgrade PPP scheme. The M50 Upgrade PPP Contract is intended to comprise the design, construction, operation, maintenance and financing of the upgrade of approximately 24 km of the existing two lane carriageways to three lane standard and the major upgrade of the junctions at the M1, N2 and N3 from their current grade separated junction type to partially free/free flow interchanges.
Mr Peter Malone, Chairman of the NRA, stated
“I am particularly pleased with the signing of the N8 Rathcormac/Fermoy Bypass PPP Contract as it means the NRA have achieved the milestone of introducing €500m of private sector finance into the national roads programme. With the Kildare Bypass open and with the Heath-Monasterevin scheme due to open later this year the construction of the N8 Rathcormac/Fermoy Bypass will ensure the removal of a further significant bottleneck on the Cork-Dublin route. In line with NDP strategy the route will be upgraded to motorway/dual carraiageway standard in its entirety and will greatly improve inter-urban journey time reliability on the Cork-Dublin route as well as facilitating a greatly improved living environment for people living along the existing route”.
Michael Tobin, Chief Executive, added that
“the award of the N8 Rathcormac/Fermoy PPP Contract demonstrates the Authority’s commitment to delivering on the NDP targets for private finance and delivery of the major inter-urban road network. I wish to thank the National Development Finance Agency (NDFA) for their assistance on this scheme.”
Please click here for a map of the N8 Rathcormac/Fermoy Bypass
For further information please contact
Caroline O'Brien, National Roads Authority
01 6602511 ext 254