Leighton consortium wins $850m NZ motorway

A team led by Australian contractor Leighton has reached financial close on a PPP-deal with the New Zealand Transport Agency for the delivery of a US$850m motorway.

The Wellington Gateway Partnership (WGP) will finance, design and construct the Transmission Gully Motorway, a 27km highway that runs north of the city of Wellington. It will then operate it over a period of 25 years; it has not yet been decided whether a toll will be charged. 

The project is New Zealand’s first highway to be delivered as a PPP. 

Financial close follows WGP’s selection as the preferred bidder in December 2013. 

WGP’s members also include HEB Construction, InfraRed Capital Partners, the Bank of Tokyo-Mitsubishi and the Accident Compensation Corporation. 

Leighton has a majority role in the design-and-construct subcontract and will perform all of the operations and maintenance work in return for $681m of the contract sum.

Marcelino Fernández Verdes, Leighton Holdings’ chairman and chief executive, said the award indicated "the strong pipeline of work we are seeing, as governments continue spending on infrastructure, underpinning an increase in PPPs". 

He added: "The Transmission Gully PPP project harnesses the resources and expertise of both the New Zealand government and the private sector to efficiently deliver this essential infrastructure."

At its peak the construction phase will employ about 700 people. It is due to be finished in 2020.

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