The Romanian Ministry of Transport, Constructions and Tourism has finalised negotiations with companies selected for the construction of the Bucharest-Brasov highway, a deal with an execution value of 1.2 billion euros. The total value of the contracts the state will sign in the spring of 2005 currently amounts to 1.7 billion euros, according to sources close to discussions.
Following negotiations with Vinci (France), Strabag (Austria) and the Israeli consortium Ashtrom-Roichmann and the kick-starting of contracts with the state, the Bucharest-Brasov highway will be even more expensive than the deal with Bechtel.
The average execution price per kilometre for the highway that will run between Bucharest and Brasov will be 9.7 million euros, as compared to 5.7 million euros per kilometre in the contract for the Brasov-Bors highway. However, the route presents more difficulties in terms of landscape.
"The Bucharest-Brasov highway will be built in all three segments using public-private partnerships. Contractors will bear the execution costs and after works are completed they will be able to recoup their investments by operating and managing the project over the long term," according to the same sources mentioned above.
The state will enter into three contracts, one for each segment of the highway.
The state recently closed negotiations for the third highway segment with the Israeli consortium of the Ashtrom and Roichmann companies and has initiated the project. The Israeli consortium will build the Predeal-Brasov segment, which has a length of 22 km, the total value of the contract for the segment being 307-310 million euros. The consortium will cover the execution costs for the project of around 183 million euros.
The remaining 229 million euros will cover financial costs, site organisation costs and management costs, and will include operation and maintenance for a certain number of years until the total value of the contract is reached.
The Romanian ministry is being advised by British law firm Norton Rose, with lawyer Simona Neagu also involved on the domestic side. For their part, the Israeli consortium is being represented by the Israeli law firm Naschitz Brandes.
All three investors won the contracts in international tenders held by the Romanian ministry in October 2002.
Romania now has around 200 km of highway, one of the lowest amounts in Europe.
Authorities have announced a highway construction programme, which would create a network of 1,300 km and requires funds of 7.5 billion dollars (6 billion euros).
adrian.mirsanu@zf.ro
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