Thailand’s Three-airport rail contract being revised because of impact of Covid-19 pandemic

Construction News
An artist’s rendering shows a stretch of the planned airport rail system linking three airports including U-tapao in the Eastern Economic Corridor.

Thailand’s Three-airport rail contract being revised because of impact of Covid-19 pandemic

CP-led consortium seeks changes to payment terms because of impact of pandemic

The contract for the high-speed rail line linking Don Mueang, Suvarnabhumi and U-tapao airports will be revised to take into account changes in economic conditions caused by the Covid-19 pandemic.

The need for changes has been agreed on by the three parties involved: the State Railway of Thailand (SRT), the Eastern Economic Corridor (EEC) Policy Committee and the Asia Era One rail consortium led by the Charoen Pokphand Group.

The revision agreement will be forwarded to the SRT board and the Office of the Attorney General for consideration next month, SRT deputy governor Anan Phonimdang said on Friday.

The review process is expected to take about 30 days, after which the matter will be submitted to the cabinet for approval, he said, adding that the revised contract could be signed in May.

The high-speed railway linking the three airports is one of the key infrastructure projects in the EEC. Covering a distance of 220 kilometres, with an estimated cost of 224 billion baht, the project was originally scheduled to start operating next year. However, the pandemic and other factors have pushed the expected operating date back to 2027 or later.

The financial impact of the pandemic on Asia Era One led the parties involved to consider changes.

Under the original contract, the bid winner is entitled to the right to manage the Airport Rail Link, with a one-time payment of 10.6 billion baht to the SRT.

The payment was originally scheduled to be made in late 2021. However, the consortium asked the government to allow it to pay the amount in seven instalments because of the economic fallout of the pandemic.

Mr Anan said that when the revised contract is signed, the consortium will be required to pay three instalments of 3 billion baht.

However, he said no conclusion has been reached yet on the overlap between the Don Mueang-Suvarnabhumi-U-tapao line and the Thai-Chinese high-speed train project.

Talks are under way to determine who will be responsible for the construction of this section of railway between the Don Muang and Bang Sue areas in Bangkok.

The SRT and Asia Era One will hold talks again and are expected to reach a conclusion by the end of next month, said Mr Anan.