Key tunnel project sees light of day

photo: dantri.com.vn

The build-operate-transfer project on building Phuoc Tuong and Phu Gia road tunnels, a section crossing central Thua Thien-Hue province kicked of construction by the Ministry of Transport (MoT) on May 18, 2013.

These two tunnels are third largest tunnel project on National Highway 1 behind Hai Van and Deo Ca tunnel projects.

A group of four local companies will execute the BOT project valued at VND1.743 trillion ($83 million).

To execute the project, apart from around VND262 billion ($12.4 million) equity capital (15 per cent of project’s total investment capital), the investor reportedly got a pledge for funding from VietinBank. Accordingly, the bank will finance the project to the tune of VND1.481 trillion ($70.5 million). 

With this loaning package, VietinBank will be the second largest capital donor after BIDV, partaking in supporting capital for National Highway 1 expansion project’s 1,700km section from north-central Thanh Hoa province to Mekong Delta’s Can Tho city.

To recoup capital, the investor is green-lighted to place toll collection stations within the project area with fee levels set under the following roadmap: from January 1, 2015 (when the project is open to traffic) to the end of 2015 - the fee will double, and after 2016 will be 3.5-fold the road tunnel fee level applicable to projects sourcing state capital regulated in Circular 90/2004/TT-BTC dated September 7, 2004 of the Ministry of Finance.

The time for capital recouping is set at around 18 years.

Earlier, the MoT chief inked a decision revising the feasibility study on building National Highway 1’s Phuoc Tuong and Phu Gia road tunnels under BOT form.

Accordingly, 345m long Phuoc Tuong and 497m long Phu Gia tunnels will include two lanes for motorised vehicles and around 6km long approaching road system. Once completed, the project will significantly shorten travel time between Hue city and Danang city, two major cultural and economic centres with robust development pace in central region key economic zone and enhance traffic safety.