The cost of New Zealand’s biggest public transport project, the Auckland City Rail Link, has jumped to US$3bn – a $673m increase on the initial estimate for the work, made in 2014.
The revised estimate was announced today by Sean Sweeney, the chief executive of City Rail Link, the state-owned company overseeing the work. He said the revised figure was reached following a "rigorous and comprehensive review" of the scheme. He added that the cost hike was partly the result of rapid inflation in the New Zealand construction industry.
"Nobody could have foreseen the competitive pressures that have occurred in construction over the past few years and the impact that has on costs, particularly for a project the scale and complexity of the City Rail Link," he said.
"Eighteen months ago, the value of work in the infrastructure pipeline on both sides of the Tasman [sea, between Australia and New Zealand] was $80bn – the value of that work is now estimated at $230bn."
A map of Auckland’s rail system, showing the proposed City Rail Link (Vardion/CC BY-SA 4.0)
The cost is also the product of a decision to increase the length of platforms to accommodate nine-coach trainsets. Â
The project involves building two 3.5km-long, twin rail tunnels up to 42m below the city centre, connecting Britomart station to the western line at Eden Terrace (see map).
The preferred bidder for the scheme is the Link Alliance, a consortium made up of Vinci Construction Grands Projets and Soletanche Bachy International of France, Australia’s Downer Group, WSP Opus and Tonkin + Taylor of New Zealand, and US engineer Aecom.
A final contract is yet to be signed, although work on site has begun and is scheduled to be complete by 2024.
Transport Minister Phil Twyford said the increase also reflected poor planning by the previous government. He commented: "The re-costing exercise has shown that the last government did not set aside enough money for inflation and cost escalation."
Top image: City Rail Link’s map showing the route of the tunnels