Construction delays push Saigon metro consultancy price tag up

By Gia Minh   January 5, 2021 | 10:05 am GMT+7
Construction delays push Saigon metro consultancy price tag up
The depot of the Ben Thanh - Tham Luong Metro Line in District 12, Ho Chi Minh City. Photo by VnExpress/Huu Khoa.
The consultancy price tag for the second metro line in HCMC has risen by nearly 29 percent following eight years of delays.

The HCMC Management Authority for Urban Railways (MAUR) said it has not concluded negotiations with an unidentified foreign consultancy for resumption of work on the Ben Thanh – Tham Luong line.

The two sides have not reached agreement over an additional EUR12.6 million ($15.5 million) payment to be made on top of the original price tag of nearly EUR44 million signed in 2012, it said.

The consultancy is demanding the extra payment for making adjustments in the design, it said.

Talks are set to resume this month after stalling due to the Covid-19 outbreak, it added.

An independent consultant is needed to extend a loan agreement with German state-owned development bank KfW that expired December 30.

The agreement will enable bidding for two construction packages, tunnels and underground stations and land acquisition, which in turn will enable further borrowing from the Asian Development Bank and European Investment Bank.

Approved 10 years ago, the project had an original price of $1.3 billion, which then ballooned to $2.1 billion by the end of 2019 over rising material and construction costs.

The ADB, KfW and EIB are providing nearly VND37 trillion ($1.6 billion), with the remaining sum of over VND10.4 trillion being counterpart funds put up by Vietnam.

It was scheduled to be completed in 2019, but the city has asked the government to extend the deadline to 2024.

When completed it will run 11 kilometers from Districts 1 to 12, 9.2 km of it underground and have 10 stations.

It is part of eight routes planned in the city with a combined length of 220 kilometers and a cost of nearly $25 billion.

 
 
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