New Demerara River bridge to cost $US 170M, with tolls increasing to 250%

New Demerara River bridge to cost $US 170M, with tolls increasing to 250%

 
700% increase for river vessels- report 

By Jarryl Bryan

The final report of a study done by Dutch consultant LievenseCSO into the construction of a new bridge over the Demerara River has made some eyebrow-raising propositions for increasing tolls to achieve a sustainable financial model.

The report, which was released on Tuesday by the Public Infrastructure Ministry, recommends that toll rates be increased to 250 percent of the present 2017 toll rates. It also recommends a 700 percent increase in tolls for river vessels.

This, according to the report, is with the view of limiting Government’s contribution to the project to around US$39 million in the first five years after the bridge is commissioned.

An artist’s impression of the proposed new bridge (Public Infrastructure Ministry photo)

It notes that interest has been found on the national and regional financial markets to fund the project, which the report estimates will cost some US$170 million, inclusive of interest, in pre-financing costs during the construction.

The report’s findings are that a minimal toll hike of 100 percent would require US$140.1 million over the first 12 years. On the other side of the spectrum, it states that US$27.3 million would be required from the Government with an increase of 300 percent.

An artist’s impression of the proposed new bridge (Public Infrastructure Ministry photo)

“From the financial projections, it was concluded that the business case of the project is financially not viable assuming similar toll rates and no contribution from Government. The main reason is the high debt service caused by the short loan periods and high interests in the market,” the report continues.

According to the report, this proposed financial structure is by project finance. It notes that the structure will be administered by a Government-owned Special Purpose Company (SPC) being the owner and arranging the funding.

According to the report, an alternative structure is to seek private parties willing to engage themselves in a Build, Operate, Own and Transfer (BOOT) Project. The consultants noted that these financiers could handle this aspect of the project more effectively than the State.
“However, project costs are higher and the BOOT business case must result in sufficient risk coverage and profit for the private partner and as a result, may require higher toll rates or more Government contribution.”

It is expected, the report added, that similar guarantees from Government will be required as in the case of project finance, adding that a DBFM (Design, Build, Finance and Maintain) model is a mixed option combining the SPC structure with possibly better financing by the private parties.

The Government’s proposed financial models have come in for strong criticism by Opposition Leader Dr. Bharrat Jagdeo. On Tuesday, Jagdeo during a press conference lambasted Government for its tenuous approach to determining a financial model to use for the bridge.

The feasibility study and design for the new Demerara River bridge, which had reportedly cost some $146.3 million, was presented to Minister within the Public Infrastructure Ministry, Annette Ferguson late last month.

The 57-page final report was done by the Dutch company, with the project team including officials from the Demerara Harbour Bridge Corporation and Transport and Harbours Department.

The feasibility study determined the proposed location of Houston-Versailles as the most ideal. The report had also determined that the bridge should be a low-level one with a movable part and three lanes.

Original Post
Prince posted:

New Demerara River bridge to cost $US 170M, with tolls increasing to 250%

 
700% increase for river vessels- report 

By Jarryl Bryan

According to the report, an alternative structure is to seek private parties willing to engage themselves in a Build, Operate, Own and Transfer (BOOT) Project. The consultants noted that these financiers could handle this aspect of the project more effectively than the State.

“However, project costs are higher and the BOOT business case must result in sufficient risk coverage and profit for the private partner and as a result, may require higher toll rates or more Government contribution.”


Build, Own, Operate and Transfer (BOOT) would be the better option for these major projects in Guyana. Proponents of the BOOT transaction will indeed ensure that they receive adequate returns for their investments plus

Given that APNU/AFC was very vocal on tolls on the Berbice River their opinion on this will be interesting.

Is this another example of how APNU/AFC said one thing before the election but then behaved exactly as they accused the PPP of behaving afterwards.

APNU suffers from the same disease that the Democratic party did. I warned before the last election that the habit of the Dems taking their core voters for granted might result in an election loss. I was correct as many stayed away.

In Guyana many blacks view the PPP as do many blacks in the USA see the GOP.  They cannot vote for them, so they express their displeasure by simply not voting.

I wonder how come APNU/AFC don't seem to hear in Guyana what we hear in NYC and that is that their voter base are angry with them and plan to show their rage by not voting in 2020.

 

 

Demerara_Guy posted:
Prince posted:

New Demerara River bridge to cost $US 170M, with tolls increasing to 250%

 
700% increase for river vessels- report 

By Jarryl Bryan

According to the report, an alternative structure is to seek private parties willing to engage themselves in a Build, Operate, Own and Transfer (BOOT) Project. The consultants noted that these financiers could handle this aspect of the project more effectively than the State.

“However, project costs are higher and the BOOT business case must result in sufficient risk coverage and profit for the private partner and as a result, may require higher toll rates or more Government contribution.”


Build, Own, Operate and Transfer (BOOT) would be the better option for these major projects in Guyana. Proponents of the BOOT transaction will indeed ensure that they receive adequate returns for their investments plus

Boot is pimping....we should build it ourselves. We can. We have oil. It would be the people's asset paying for the peoples utility and toll should be assessed per maintenance need. Any other construct is allocation of resources.

Stormborn posted:

Boot is pimping....we should build it ourselves. We can. We have oil. It would be the people's asset paying for the peoples utility and toll should be assessed per maintenance need. Any other construct is allocation of resources.

Finally you make sense. But I fear Granger et al have their own ideas on how to steal the oil money. 

What is the lifespan of a bridge? The reason for asking, even if it is 50 or 100 years, the artist impression shows three lanes. Why not four lanes? Two going and two coming with shoulders for emergency, and perhaps a walkway to accommodate increasing traffic for 25-50 years ahead? 

Prince posted:

What is the lifespan of a bridge? The reason for asking, even if it is 50 or 100 years, the artist impression shows three lanes. Why not four lanes? Two going and two coming with shoulders for emergency, and perhaps a walkway to accommodate increasing traffic for 25-50 years ahead? 

the design is three lanes each way for a total of six. Indeed there should be a bike/pedestrian walkway.

Stormborn posted:
Demerara_Guy posted:
Prince posted:

New Demerara River bridge to cost $US 170M, with tolls increasing to 250%

 
700% increase for river vessels- report 

By Jarryl Bryan

According to the report, an alternative structure is to seek private parties willing to engage themselves in a Build, Operate, Own and Transfer (BOOT) Project. The consultants noted that these financiers could handle this aspect of the project more effectively than the State.

“However, project costs are higher and the BOOT business case must result in sufficient risk coverage and profit for the private partner and as a result, may require higher toll rates or more Government contribution.”


Build, Own, Operate and Transfer (BOOT) would be the better option for these major projects in Guyana. Proponents of the BOOT transaction will indeed ensure that they receive adequate returns for their investments plus

Boot is pimping....we should build it ourselves. We can. We have oil. It would be the people's asset paying for the peoples utility and toll should be assessed per maintenance need. Any other construct is allocation of resources.

It is not Guyana pursuing the exploration and possible development for oil.

It is ExxonMobil.

Guyana will receive a percentage of the profits after ExxonMobil recovers its cost for exploration, operation, etc.

Thus far it is unknown when Guyana will receive its portion of the revenue.

Stormborn posted:
Prince posted:

What is the lifespan of a bridge? The reason for asking, even if it is 50 or 100 years, the artist impression shows three lanes. Why not four lanes? Two going and two coming with shoulders for emergency, and perhaps a walkway to accommodate increasing traffic for 25-50 years ahead? 

the design is three lanes each way for a total of six. Indeed there should be a bike/pedestrian walkway.

Slowly you losing your marbles. It's 3 lanes.

I have visited the Nanjing Yangste River Bridge. The Chinese takes pride and boasts that the bridge was built strictly with Chinese labourers and Chinese expertise. They refused all foreign help. The Engineers gave their expertise for free just to keep out all outsiders.

 

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