M4/M6 Kilcock - Kinnegad Motorway

Under the Government announcement of the pilot projects on 1st June 1999 this project was to be assessed by the NRA for its suitability to be advanced as a PPP. Subsequently the project was included as one of the projects approved under Tranche II of the PPP Roads programme as announced by the NRA in June 2000. The project involved the construction of 39 km of motorway from Kinnegad to Kilcock and is an extension of the Kilcock-Maynooth-Leixlip motorway on the N4/N6 Sligo/Galway to Dublin route. The Motorway by-passes the towns of Enfield and Kinnegad.

The PPP contract was awarded in March 2003 to the EuroLink Consortium (SIAC Construction Ltd and Cintra - Concesiones de Infraestrucutras de Transporte S.A.).

Contract Award Date	Contract Awarded to	PPP Type	Government Programme	Status
March 2003	Eurolink Consortium	Concession	National Development Plan 2000 - 2006	Opened 2005

For further information relating to this road please contact Eurolink on 046 954 0266

Please click here for the M4 Eurolink website

Financial Aspects of the M4/M6 Kinnegad-Kilcock Motorway PPP Contract
Concession Company at Contract Award The EuroLink consortium comprises SIAC Construction Limited, an Irish construction company, and Cintra - Concesiones de Infraestrucutras de Transporte S. A., a major Spanish company with road concession interests in Spain, Portugal, Canada and Chile.
Duties and obligations of the Concession Company For the 39 km motorway scheme, including 19 overbridges, 7 underbridges, and 3 underpasses, Eurolink is required to carry to undertake the following tasks: Design Complete the full detailed design of all new build elements; Carry out necessary structures assessments at various stages throughout the concession period. Build Construct all the new works; Assume responsibility for ground conditions, archaeological monitoring and resolution, utility relocations and, landscaping. Maintain Maintain the road pavement, structures, landscaping, signs, lining, lighting, safety barriers, fencing and all other aspects of the road; Carry out comprehensive winter maintenance including patrols, precautionary salting, and snow clearance. Operate Manage the road in terms of safety, traffic management, information to the road user, oil spillage, accidents; Operate the tolling system to the required levels of service and upgrade it as necessary to match demand; Re-invest Prior to handback to the public sector at the end of the concession, upgrade all the facilities as necessary (e.g. road re-sufacing, re-lining) in order to provide the required residual life for the road. In regard to the road structure, the concessionaire is to hand it back with a further 10 year life before any structural strengthening would be required. Finance Raise finances for the scheme and take the responsibility for all the repayments; Carry the risk of cost over-runs.
Period of Concession The contract was signed on the 24th March 2003 and will extend for 30 years from that date. The construction is anticipated to take approximately 3.5 years and EuroLink will be responsible for collection of tolls for a period of approximately 26.5 years.
Cost of the project The Authority estimates that if it were to undertake itself all the design, construction, maintenance, operation and re-investment tasks that are being required of Eurolink the cost would be in the order of €550m in 2003 values. The Authority estimates that the cost of land, preliminary studies/design necessary to identify the route, preparation of the statutory documents (Motorway scheme and Environmental Impact Statement), advance ground investigation, initial archaeological testing and resolution, and supervision of its construction will amount to approximately €64m. These costs apply irrespective of the contractual means that could be employed for the delivery of the scheme.
Eurolink's Financing Eurolink has arranged funding from three sources: Two Spanish banks - Banco Bilbao Vizcaya Argentaria, S.A. and Banco Santander Central Hispano, S.A.¹ European Investment Bank – a bank owned by the member states of the European Union which invests in necessary EU infrastructure; Funds from Cintra and SIAC. EuroLink is the party responsible for the repayment of these debts. ¹Post financial close debt was syndicated to three further banks - Banco Português de Investimento (Banco BPI - a Portugese bank), Banco San Paulo (an Italian bank), and Instituto de Credito Official (ICO - a Spanish bank).
Payments from the Authority to Eurolink The Authority’s payments to Eurolink are fixed and consist of payments of €146m (2003 values) over the period of the construction, released on satisfactory completion of key construction elements, and €6m (2003 values) in total in the period of operation.
Payments from Eurolink to the Authority EuroLink will pay a share to the Authority, dependent on the level of traffic on the road, of the toll revenues collected. Without divulging full details due to the commercial sensitivity of the exact proposal, the Authority anticipates that this revenue share will be a very substantial amount of money that will part repay the subvention payments that the Authority will have made and will be payable during the period of the concession.
Payments from Eurolink to the State In addition to the revenue share that it will pay to the Authority, EuroLink will be obliged to make the following payments: Commercial rates: In accordance with the Valuation Act 2001, EuroLink will be the occupier of a rateable property due to its operation of the toll facilities. EuroLink will be required, dependent on the traffic volumes and calculated in accordance with a methodology set out by the Valuation Office, to pay rates to the three local authorities through whose administrative area the road passes. Corporation Tax VAT on non-recoverable receipts. As with the revenue share, the Authority does not wish to state the estimated amount of these payments but can confirm that they will amount to a substantial amount of money.
Summary Overview For infrastructure with an estimated cost of €550m excluding land/preparatory costs, the State will pay €152m excluding land/preparatory costs and will recoup very substantial monies by means of revenue share, rates and taxes.

Financial Aspects of the M4/M6 Kinnegad-Kilcock Motorway PPP Contract

Concession Company at Contract Award

The EuroLink consortium comprises SIAC Construction Limited, an Irish construction company, and Cintra - Concesiones de Infraestrucutras de Transporte S. A., a major Spanish company with road concession interests in Spain, Portugal, Canada and Chile.

Duties and obligations of the Concession Company

For the 39 km motorway scheme, including 19 overbridges, 7 underbridges, and 3 underpasses, Eurolink is required to carry to undertake the following tasks:

Design
- Complete the full detailed design of all new build elements;
- Carry out necessary structures assessments at various stages throughout the concession period.
Build
- Construct all the new works;
- Assume responsibility for ground conditions, archaeological monitoring and resolution, utility relocations and, landscaping.
Maintain
- Maintain the road pavement, structures, landscaping, signs, lining, lighting, safety barriers, fencing and all other aspects of the road;
- Carry out comprehensive winter maintenance including patrols, precautionary salting, and snow clearance.
Operate
- Manage the road in terms of safety, traffic management, information to the road user, oil spillage, accidents;
- Operate the tolling system to the required levels of service and upgrade it as necessary to match demand;
Re-invest
- Prior to handback to the public sector at the end of the concession, upgrade all the facilities as necessary (e.g. road re-sufacing, re-lining) in order to provide the required residual life for the road.
- In regard to the road structure, the concessionaire is to hand it back with a further 10 year life before any structural strengthening would be required.
Finance
- Raise finances for the scheme and take the responsibility for all the repayments;
- Carry the risk of cost over-runs.

Period of Concession

The contract was signed on the 24th March 2003 and will extend for 30 years from that date. The construction is anticipated to take approximately 3.5 years and EuroLink will be responsible for collection of tolls for a period of approximately 26.5 years.

Cost of the project

The Authority estimates that if it were to undertake itself all the design, construction, maintenance, operation and re-investment tasks that are being required of Eurolink the cost would be in the order of €550m in 2003 values.

The Authority estimates that the cost of land, preliminary studies/design necessary to identify the route, preparation of the statutory documents (Motorway scheme and Environmental Impact Statement), advance ground investigation, initial archaeological testing and resolution, and supervision of its construction will amount to approximately €64m. These costs apply irrespective of the contractual means that could be employed for the delivery of the scheme.

Eurolink's Financing

Eurolink has arranged funding from three sources:

Two Spanish banks - Banco Bilbao Vizcaya Argentaria, S.A. and Banco Santander Central Hispano, S.A.¹
European Investment Bank – a bank owned by the member states of the European Union which invests in necessary EU infrastructure;
Funds from Cintra and SIAC.

EuroLink is the party responsible for the repayment of these debts.

¹Post financial close debt was syndicated to three further banks - Banco Português de Investimento (Banco BPI - a Portugese bank), Banco San Paulo (an Italian bank), and Instituto de Credito Official (ICO - a Spanish bank).

Payments from the Authority to Eurolink

The Authority’s payments to Eurolink are fixed and consist of payments of €146m (2003 values) over the period of the construction, released on satisfactory completion of key construction elements, and €6m (2003 values) in total in the period of operation.

Payments from Eurolink to the Authority

EuroLink will pay a share to the Authority, dependent on the level of traffic on the road, of the toll revenues collected. Without divulging full details due to the commercial sensitivity of the exact proposal, the Authority anticipates that this revenue share will be a very substantial amount of money that will part repay the subvention payments that the Authority will have made and will be payable during the period of the concession.

Payments from Eurolink to the State

In addition to the revenue share that it will pay to the Authority, EuroLink will be obliged to make the following payments:

Commercial rates: In accordance with the Valuation Act 2001, EuroLink will be the occupier of a rateable property due to its operation of the toll facilities. EuroLink will be required, dependent on the traffic volumes and calculated in accordance with a methodology set out by the Valuation Office, to pay rates to the three local authorities through whose administrative area the road passes.
Corporation Tax
VAT on non-recoverable receipts.

As with the revenue share, the Authority does not wish to state the estimated amount of these payments but can confirm that they will amount to a substantial amount of money.

Summary Overview

For infrastructure with an estimated cost of €550m excluding land/preparatory costs, the State will pay €152m excluding land/preparatory costs and will recoup very substantial monies by means of revenue share, rates and taxes.