CP Group consortium pressured on Thailand’s 3-airport railway bid
EEC seeks to finalise high-speed details
28 February 2019
The Eastern Economic Corridor (EEC) Office has given the CP Group-led consortium an ultimatum to conclude its financial proposal for the 224.5-billion-baht high-speed railway connecting three major airports by March 5, otherwise the state will negotiate with BSR Joint Venture.
Kanit Sangsubhan, secretary-general of the EEC Office, said the government plans to talk with BSR Joint Venture if the selection committee on the project fails to conclude bidding details with the CP Group-led consortium.
“The committee is going to meet with the consortium next Tuesday with the final conclusion,” he said. “The government has no worries about any delays because the bidding procedure remains on schedule.”
Mr Kanit said that if the committee and the winning consortium cannot reach an agreement, the committee can call on BSR Joint Venture instead.
“We cannot change the bidding conditions noted in the terms of reference, but the CP Group-led consortium is asking to change some details,” Mr Kanit said, adding that the construction start date will not be affected.
The CP-led group’s conditions call for an extension of the contract from 50 years to 99 years, state subsidies for the project from the first year of operations, a guarantee of 6.75% internal rate of return and a soft loan at 4% interest.
The high-speed railway connecting three major airports — Don Mueang, Suvarnabhumi and U-tapao — received bids from two consortiums last November.
BSR Joint Venture consists of BTS Group Holdings Plc, Sino-Thai Engineering and Construction and Ratchaburi Electricity Generating Holding.
The CP Group-led consortium includes China Railway Construction Corporation, Bangkok Expressway and Metro, Italian-Thai Development, Ch. Karnchang, Japan Overseas Infrastructure Investment Corp for Transport & Urban Development, Citic Group, Siemens, Hyundai, Japan Bank for International Cooperation and Ferrovie dello Stato Italiane SpA.
The winning bidder will be awarded a 50-year contract that includes five years for design and construction and 45 years for operations.
The government expects the railway project to yield 700 billion baht in economic returns.