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Auditors warn of Rail Baltica cost and timescale risks

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Rail Baltica

Procedures for managing the Rail Baltica project are mostly in place but inefficiencies and a lack of change and risk management systems mean the project could exceed its agreed budget and timeline, according to a report issued jointly by the national audit bodies of Estonia, Latvia and Lithuania on January 7.

The 1 435 mm gauge line running 870 km from Tallinn to the Polish border is currently estimated to cost €5·79bn, with grants from the EU’s Connecting Europe Facility expected to cover 85% of this. Completion is scheduled for 2026.

However, the auditor found that the three national ministries and the trinational RB Rail project management joint venture had not managed to keep to the timeline and budget agreed as part of the CEF grants, with work being 1½ years behind schedule and the budget for the first grant agreement being exceeded by €59·3m.

Legal analysis found the implementation structure does not conflict with legislation in the Baltic States. However, it was not clear who takes decisions and who has to follow these decisions. There is no effective mechanism for solving any deadlock, the report says, and differing national visions for governance have led to time being wasted.

While Rail Baltica is included in the three countries’ medium-term budgets, none have long-term plans for financing the project through to completion and there are no approved plans to cover cost overruns or what would happen if the EU co-financing were lower than estimated.

National audits of the project have also been undertaken in parallel with the joint audit. Lithuania’s report was issued in 2018, Estonia’s in 2019 and Latvia’s will follow this year. The European Court of Auditors will also publish a report focusing on the European Commission’s role in supporting Rail Baltica and other projects.

RB Rail said it respected the auditors’ findings. ‘We are committed to take action and have already started to implement necessary measures to achieve tangible change in the areas highlighted’, said Agnis Driksna, interim CEO and Chairman of the management board. ‘While the audit highlights both scheduling and budget risks, the implementation of Rail Baltica by 2026 remains our target.

We have identified the key preconditions necessary to meet this target, including improved decision making during the design and construction phases and timely availability of funding. If these preconditions are met effectively, Rail Baltica can be delivered on time.’

Chief Financial Officer Ignas Degutis said more technical information was becoming available as the project progresses, and cost estimates would be updated once the detailed designs were completed in 2021. There were also ‘plenty of options to consolidate the costs of the projects through joint procurement and smart engineering’, he believed.

RB Rail is to develop a new internal procedure for the appointment of procurement committee members and external experts by March, along with a new regulation on conducting preliminary market research.

Planning, scheduling, reporting and risk management software will be in place by July, helping to ensure that schedules and budgets are accurately defined and monitored and that risks are anticipated and managed proactively.

Rail Baltica project status

Design work is now underway on 411 km of the main line;

Six detailed technical design contracts for the main line have been signed;

The stations at Tallinn and Pärnu are being designed;

Design and build works for Rīga Central station have started;

Procurement has been launched for construction of the Rail Baltica terminal at Rīga airport;

Some road and rail infrastructure works have started in Estonia and Lithuania;

Lithuania has completed planning for the Kaunas – Latvian border section and launched the planning process for the Vilnius – Kaunas branch;

The operational plan has been prepared;

€800m of funding has been secured, with the next CEF application to be submitted in February.

 

Source: railwaygazette.com

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Technical offer for Hellinikon casino project, approved

Νίκος Καραγιάννης

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Καζίνο Ελληνικό Mohegan ΓΕΚ ΤΕΡΝΑ

Α step forward has been taken in the case of the casino in Elliniko since, as it became known, the technical offer of Mohegan-GEK TERNA consortium was approved by the Gaming Supervision and Control Committee (EEEEP), which is also the finalist for this large-scale project.

What remains now is the award of the tender, a step which is currently unknown when it will take place due to the pending case of Hard Rock International’s appeal to the Council of State. It is reminded that the American company made this move despite the repeated negative decisions for it in this tender, due to the rejection of its offer.

The completion of the tender for the Integrated Resort Casino (IRC), is a basic deferral condition for the initiation of the project in Elliniko, which means that the relevant contract must first be signed in order for the signatures concerning the large investment in the spaces of former international airport to be completed.

Inspire Athens

The official name given by Mohegan-GEK TERNA consortium is “Inspire Athens” and is a mega-project, in fact the largest building project in Greece, while for GEK TERNA will be a top addition to the portfolio of projects that implements.

“Inspire Athens”, the first integrated tourist complex with casino in Greece, consists of a luxury hotel, entertainment venues, conference center, shops, restaurants, as well as a complete range of high quality services. The project will help to inaugurate a new era of touristic development and economic prosperity for Greece and the whole region.

The flagship design of the building is a creation of the international architectural firm Steelman Partners, which specializes in the design and construction of IRC complexes.

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Shift2Rail approves €75.4m funding for 19 projects

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Σιδηροδρομικό έργο

The Shift2Rail (S2R) joint venture (JV) has announced that it will provide up to €75.4m in funding for 19 projects worth a total of €147.7m under the 2020 call for proposals for research and innovation (R&I) activities.

S2R members will undertake eight projects worth €127.7m, with the JV providing €55.4m in funding. An additional 11 open call projects worth €22m have been approved, of which up to €20m will be funded by S2R.

A total of 242 participants will be involved in the projects, with 29% of these small and medium enterprises (SMEs).

S2R received 43 requests for a combined €113.3m in funding in the call for proposals, which was around 50% more than the funding available.

“This is an important transition moment for S2R and the rail research and innovation community at large,” says S2R executive director, Mr Carlo Borghini. “These new projects are our ticket to moving into the successor programme and beyond R&I to market uptake of our forward-looking solutions.”

S2R has invested its full budget of €400m over the past four years, resulting in the launch of research worth an estimated €1bn. Last year, S2R published the inaugural edition of its Catalogue of Solutions, which offers railway executives and buyers a clearer picture of what the rail solutions of the future will look like.

 

Source: railjournal.com

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Pyrgos-Kalo Nero road project in Western Peloponnese, signed

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Εργασίες ασφαλτόστρωσης οδοστρωτήρας

The important road project concerning the upgrade of road safety on Pyrgos-Kalo Nero axis was signed. The contractor of the project is ODOS ATE with a discount rate of 46.53%. It is a 54 km long interregional project. which includes works in both the Prefecture of Ilia and of Messinia, improving the characteristics of the existing section and increasing the level of road safety. The contracting authority is the Ministry of Infrastructure and Transport.

The project was signed on July 23 at the Ministry of Infrastructure and Transport, in Papagou. The initial cost of the project reached 19.8m euros (VAT incl., excl. VAT: 15.96m euros). The auction of the project took place on September 12 and the unsealing of the offers on September 18, 2019. A total of eight companies participated.

The duration of the contract is 730 days, i.e. 2 years. According to rough calculations, the projects, if there aren’t any delays during the construction period, will be completed in the middle of 2021.

The financing of the project will be covered by the NSRF 2014-2020 and more specifically by the O.P. YME-PERAA. It is reminded that Pyrgos-Kalo Nero was part of Olympia Odos until 2013. Then in the famous “restart”, the whole section from Patras to Tsakona was out of the scope of the project. This section also includes the area of ​​Kaiaphas, which has been designated as Natura.

The scope of the project is the implementation of short-term interventions in order to improve road safety featured on the road section of National Road 9 (National Road 9: Patra-South Messinia) “Pyrgos-Kalo Nero”, with a total length of 54 km, in the Regional Units Ilia (42 km) and Messinia (12 km).

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