N6 Galway to East Ballinasloe

The N6 Galway to East Ballinasloe project was developed as a Public Private Partnership. The scheme extends 57.6 km, commencing in Galway with a roundabout at Doughiska, on the existing N6 dual carriageway, south of the R339, and terminating in Roscommon with a roundabout on the existing N6 at Beagh, east of Ballinasloe. The scheme comprises 56 km of dual carriageway with 1.6 km of single carriageway at its eastern end and 7 km of a single carriageway link to the Loughrea By-Pass. There are 4 grade-seperated junctions; at Glennascaul, on the N18; at Newford, south west of Athenry; at Carrowkeel, north of Loughrea and at Brackernagh, south west of Ballinasloe. The new N6 will allow traffic to bypass Oranmore, Craughwell, Loughrea, Kilreekill, Aughrim and Ballinasloe as well as providing direct access to Athenry.

In April 2007 the PPP contract was awarded to N6 (Concession) Limited which comprises FCC Construction S.A. and Itinere Infraestructuras, both major companies from Spain, and PJ Hegarty & Sons from Ireland.

Contract Award DateContract Awarded toPPP TypeGovernment ProgrammeStatus
April 2007 N6 (Concession) Ltd. Concession National Development Plan 2000 - 2006 Opened 2009
Financial Aspects of the N6 Galway to Ballinasloe PPP Scheme

Concession Company

The N6 Galway to Ballinasloe PPP contract was awarded to (N6 Concession) Limited in April 2007. ICON comprises FCC Construction S.A. and Itinere Infraestructuras, both major companies from Spain, and PJ Hegarty & Sons from Ireland.

Duties and obligations of the Concession Company

The N6 Galway to Ballinasloe dual carriageway is a key part of the plan to upgrade the overall roads network for the country. It will significantly benefit the Western Region and as a key element of the interurban network it will improve road transport connections between the West and the East of the country.

This scheme is the second largest road scheme under Transport 21, with the M3 Clonee – Kells Motorway being the largest.

More specifically, the route runs from the outskirts of Galway city to Athenry where it crosses the Galway/Dublin rail line, the Graigabbey River and the Athenry/Limerick rail line. The route then continues southeast to Carrowkeel junction from where the Loughrea link road proceeds south to the Loughrea Bypass. From Carrowkeel junction, the route continues northeast to the proposed Toll Plaza located near Cappataggle. The route then passes north of Aughrim village, continuing east again over the River Suck to its termination at Tulrush east of Ballinasloe, where a link road connects to the existing N6 at Beagh in Co. Roscommon.

The Scheme includes five grade-separated junctions – at Glennascual, Athenry, Carrowkeel, West Ballinasloe and East Ballinasloe. A Toll Plaza and associated utilities are located close to Cappataggle village, on the dual carriageway between Gortnahoon and Ballynaclough overbridges. There are also be 9 roundabouts on link roads, 1 major river crossing, 3 rail crossings, 30 road bridges and a footbridge. There is also accommodation structures for landowners, side roads and culverts.

ICON is required to carry out the following tasks:

  • Design
    • Completed the full detailed design of all elements of the works.
  • Build
    • Construct alll the works, assuming responsibility for ground conditions, archaeological monitoring and resolution, utility relocations and landscaping.
  • Maintain
    • Maintain the road pavement, structures, landscaping, signs, linning, lighting, safety barriers, fencing and all other aspects of the road; and
    • Carry out comprehensive winter maintenance including precautionary salting and snow clearance.
  • Operate
    • Manage the road in terms of safety, traffic management, information to the road user, oil spillage, accidents; and
    • Operate the tolling systems to the required levels of service.
  • Re-invest
    • Prior to handback to the public sector at the end of the concession, upgrade all the facilites as necessary (e.g. road re-surfacing, re-lining) in order to provide the required residual life for the road; and
    • In regard to the road structure, the concessionaire is to hand 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; and
    • Carry out the risk of cost of over-runs.

Period of Concession

The contract was signed on the 4th April 2007. The contract will extend for 30 years from that date. The construction is anticipated to take approximately 3 years, to be completed in 2010, and ICON will be responsible for collection of tolls for a period of approximately 27 years.

Cost of the project

The Authority estimates that if it were to undertake itself all the design and construction tasks that are being required of ICON that the cost would be in the order of €475m (excluding land and preliminary design costs) in Net Present Value, January 2007 values.

In addition, the costs of operating and maintaining the built roads would be in the order of €130m (Net Present Value, January 2007 values) over the 30 year period.

In relation to land and preliminary design, the Authority estimates that the cost of land, preliminary studies/design necessary to identify the route, preparation of the statutory documents (Environmental Impact Statement), advance ground investigation, initial archaeological testing and resolution, and supervision of its construction will amount to approximately €270m and will be borne by the Authority. These costs apply irrespective of the contractual means employed for the delivery of the scheme.

ICON's Financing

The majority of the funding is debt funding and ICON has arranged funding from three sources.

  • Debt funding from Roayl Bank of Scotland ("RBS"), Banesto, Fortis and MCC SpA (a component of Italy's fourth-largest banking group);
  • The European Investment Bank ("EIB") - a bank owned by the member states of the European Union which invests in necessary EU infrastructure; and.
  • Funds from the consortium members.

In all, total bank debt of approximately €250m has been raised to fund the scheme. ICON is the party responsible for the repayment of all these debts and without recourse to the state

ICON itself is investing substantial funding into this project by means of equity in the order of €30m from the companies included in the consortium.

Payments from the Authority to ICON

The Authority’s payments to ICON are fixed and consist of payments of €136m (Nominal) over the period of the construction, released on satisfactory completion of key construction elements, and €137m (Net Present Value, January 2007 values) during the period of operation. (Note: Operational payments are subject to indexation in line with the consumer price index.)

Payments from ICON to the Authority

ICON will pay a share to the Authority, dependent on the level of traffic on the road, of the toll revenues collected. This Revenue Share arrangement will operate as a mechanism to protect against the Concessionaire earning excessive profits in the event of unanticipated increases in traffic volumes.

Payments from ICON to the State

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

  • Commercial rates: In accordance with the Valuation Act 2001, ICON will be the occupier of a rateable property due to its operation of the toll facilities. ICON 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 Local Authority(s) through whose administrative area the road passes;
  • Corporation tax; and
  • VAT on non-recoverable receipts.

Summary Overview

For infrastructure with an estimated cost (construction and on-going operations and maintenance) of €605m, excluding land/planning/preparatory design costs, the State will pay €136m (excluding land/preparatory costs) throughout the 3-year construction period along with a further €137m during the operational period. The State will recoup monies by means of revenue share, rates and taxes.