Client Agency:
RMS
Project Description:
The original project involved financing, construction, operation and maintenance of a 14.5km motorway between Beverley Hills and Casula, in the south-west of Sydney. Due to variations outlined below, this project has since been extended to cover 21km of motorway between Beverley Hills and Prestons. The original arrangement comprised:
- RMS providing loans to the private sector of $35 million, including $22 million in land and $13 million in cash, repayable after the private sector's bank debt has been fully repaid;
- a concession period of 22 years post-completion after which the road would revert to public ownership (since extended to 34 years);
a toll of $1.10 for cars and $3.30 for trucks (December 1989 dollars), escalated at the greater of CPI or 9% per annum (the right to increase tolls at 9% per annum was removed in 1993 under the MS Western Extension arrangement).
Private Sector Partners:
Interlink Roads Pty Limited (Interlink)
Project Details:
Contract value:
Original project: $315 million (1991)
Western Extension: $65 million (1993)
Moorebank Avenue Interchange: $32 million (2002)
Widening: $400 million (2012)
Contract term:
22-Feb-1991 to 2014 (since extended to December 2026).
Operation began:
The road was opened to traffic in Oct-1992. The MS western extension and Moorebank Avenue Interchange were opened to traffic in 1995 and February 2003 respectively.
Project Variations:
29-Jun-1993 MS Western Extension
The RMS and Interlink negotiated to extend the MS to the west from Moorebank to Prestons. The western extension with the estimated capital costs of $65 million involved:
- RMS making an additional $50 million loan to Interlink, with the balance of the cost being financed by the CBA;
- extension of the concession period by 8 years to 2022;
- renegotiation of tolling arrangements, requiring Interlink to peg tolls for 3 years and then escalate at CPI(foregoing the right to increase tolls at 9% per annum, as provided in the original deed)
30-Jun-1997 Sale of RMS Loans
The loans previously advanced by RMS to Interlink (totalling $85 million) to construct the MS South West and the MS Western Extension were sold to CBA for $110 million. The proceeds were used to partially fund the construction of the MS East extension.
15-May-2002 Moorebank Avenue Interchange
Interlink proposed to finance and construct the grade separated interchange at the intersection of the MS and Moorebank Avenue with the estimated capital cost of $32 million, to be funded by the increased traffic projected as a result of the improved traffic flow, with the balance of the cost being funded by an increase in the MS concession term until August 2023.
19-Jun-2012 MS South West Motorway Widening
The RMS and Interlink Roads reached final agreement to widen the MS South West Motorway to three lanes in each direction, between Beverley Hills and Prestons. The $400 million project was funded through:
- A 3.3-year concession extension, to December 2026;
- An increase in truck tolls to 3 times car tolls, to be implemented following construction completion;
The NSW Government contributed around $50 million towards the project cost, being for noise walls, drainage and other works arising out of the final Planning Approval conditions.
