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Major players win big as HS2 awards £6.6bn construction contracts

A number of high-profile joint ventures (JVs) have been revealed as the winners of £6.6bn worth of major construction and civil engineering contracts for the first phase of HS2 between London and Birmingham.

In March last year, the tender for the main civil engineering works contracts, comprising bridges, tunnels, embankments and viaducts, was released. And today’s announcement includes decisions on the first and second stages of the big construction contracts.

The total value of these contracts, including both Stage 1 and Stage 2, is estimated to be worth £6.6bn. Stage 2 will commence in 2019 and, along with Stage 1, is expected to support 16,000 jobs across the country.

Sir David Higgins, chairman of HS2 Ltd, said: “HS2 was always designed to be much more than just a high-speed railway and today we can see the opportunities it brings right around the country – spreading prosperity, acting as a catalyst for investment and rebalancing our economy 10 years before the railway even opens.

“Business now has the surety to invest with confidence to build a legacy for Britain.”

The winning bidders to build the first phase of the route are:

Area South

  • Euston Tunnels and Approaches – SCS JV (Skanska Construction UK Ltd, Costain Ltd, STRABAG AG)
  • Northolt Tunnels – SCS JV (Skanska Construction UK Ltd, Costain Ltd, STRABAG AG)

Area Central

  • Chiltern Tunnels and Colne Valley Viaduct – Align JV (Bouygues Travaux Publics, VolkerFitzpatrick, Sir Robert McAlpine)
  • North Portal Chiltern Tunnels to Brackley – CEK JV (Carillion Construction Ltd, Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd)
  • Brackley to South Portal of Long Itchington Wood Green Tunnel – CEK JV (Carillion Construction Ltd, Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd)

Area North

  • Long Itchington Wood Green Tunnel to Delta Junction and Birmingham Spur – BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement)
  • Delta Junction to WCML Tie-In – BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement)

After being awarded contracts worth a total of £2.5bn, Mark Cutler, BBV JV managing director for HS2, said: “I am proud that our long-standing joint venture has been chosen to deliver these two integral sections of HS2.

“This iconic rail infrastructure project will create significant opportunities for the UK construction industry and will drive growth in skills, jobs and prosperity. We look forward to building on our successful track record delivering high profile projects, and help to engineer Britain’s second great railway age.”

TransCityRail 2017

The JV will deliver Lot N1, valued at circa £1.32bn, and Lot N2, valued at circa £1.15bn, between the Long Itchington Wood Green tunnel to the Delta Junction/Birmingham Spur and from the Delta Junction to the West Coast Main Line tie-in respectively, in a two-part design and build contract.

Carillion, one of Network Rail’s top suppliers, stated that as part of the CEK JV it was delighted to have been selected to deliver two of the three Central contracts for HS2 Phase 1.

The JV has been allotted Lot C2: North Portal Chiltern Tunnels to Brackley £724m; and Lot C3 - Brackley to Long Itchington Wood Green Tunnel South Portal £616m.

All the packages have been let as two-part design and build contracts, to “encourage innovation and flexibility” in delivery and collaboration across the supply chain and with HS2 Ltd.

Keith Cochrane, interim CEO at Carillion, said: “Carillion is a leading supplier of infrastructure services with top two positions in both the UK rail and highways sectors, where we work in partnership with key customers, including Network Rail, Highways England and HS2. 

“We expect the UK government’s objective of generating economic growth through investing in infrastructure to continue creating opportunities for us to grow our business in these core markets.”

Shot in the arm

Following the announcement of the deals, TUC deputy general secretary Paul Nowak said: “This is a shot in the arm for Brexit Britain. It will provide thousands of decent jobs, billions in investment, and help close the north-south divide.

“HS2 is a real opportunity for British steel to shine. The next phase of HS2 should bring jobs and investment to the parts of Britain that need them most.”

In February, Parliament granted powers to construct Phase 1 from London Euston to Birmingham, with the route opening in 2026.

Transport secretary Chris Grayling argued that this is a hugely important step in the construction of Britain’s new railway and underlined the government’s determination to deliver an economy that works for all.

“HS2 will deliver vital links between some of our country’s biggest cities, helping to drive economic growth and productivity in the north and midlands,” said Grayling.

He added that later today he will be introducing a bill to Parliament seeking the necessary powers to construct Phase 2a of HS2, from West Midlands to Crewe. Phase 2a will bring HS2 within reach of all the cities in the north that have existing rail connections to Crewe.

HS2 Ltd also revealed the names of the designers and engineers who are formally in the running to develop detailed plans for three brand new stations and majorly expand London Euston.


John   18/07/2017 at 06:46

`Sir David Higgins, chairman of HS2 Ltd, said: “HS2 was always designed to be much more than just a high-speed railway and today we can see the opportunities it brings right around the country – spreading prosperity, acting as a catalyst for investment ` The Liverpool City Region, with a population of about 2 million, is about 16 miles from the HS2 track, however is not being connected. The city offered £2bn to be connected with HMG turning them down. Prosperity? For who?

John   18/07/2017 at 06:48

England gets most expensive railway on Earth. Wales still waits for its first mile of electrified track.

John   18/07/2017 at 07:15

Mark Littlewood is Director General of the Institute of Economic Affairs. He was excellent on the BBC yesterday. That by the time HS2 is delivered in 203? it will be using old technology. He emphasised that the cost is bound to rise and will not make a reasonable return for the foreseeable future. He was talking about the first phase being the least required. and that there are far better ways to invest in infrastructure. His bottom line was that HS2 is a "vanity project'.

J, Leicester   18/07/2017 at 09:15

John, I've explained in the past the logistical nightmare which would be involved in connecting central Liverpool to the HS2 network - would you be happy to see swathes of Wavertree, Belle Vale or Aintree razed to the ground for the sake of 16 miles of track? HS2 could not be connected to the city without either tearing a new route through the suburbs or routing it onto a network already at capacity, whether that is mainline or Merseyrail. It's a very different case to, say, Sheffield, which still has the capacity for track upgrades north and south of the station, as the trackbed there has either not had signalling upgrades or remains rationalised after decades of neglect by BR. Liverpool's capacity, on the other hand, is unlikely to be able to be increased much further to accommodate a whole new main-line route. And that's to say nothing of the money one could blow on a new rail tunnel purely to serve the city for limited wider benefit. But I mean sure, if you can find 20,000 displaced people somewhere new to live so you can have a shinier train that isn't even that much faster at Lime Street, go for it.

Chrism   18/07/2017 at 12:54

It seems to have gone over the heads of the predictable anti posters, but this contract information means that HS2 is well under budget - by half a £billion. This is a spectacular result, considering that in March last year these seven contracts were valued at £7.1 to £11.8 billion. This proves that many of the cost claims made by opponents were complete and utter nonsense.

John   18/07/2017 at 20:08

@J, Leicester They could build a 7.5 mile tunnel into Liverpool as they have done in Manchester. Please do not come back and say Manchester is bigger city and bigger economy. The both are about the same with Manchester slightly ahead. You missed the point about the Port of Liverpool needing rail provision. The port is the only deep water port on that coast. It is essential to adequate rail line.

John   18/07/2017 at 20:10

@Chrism Do you actually believe HS2 will come in on budget?

J, Leicester   19/07/2017 at 13:48

John, you vastly overestimate the need for a high-speed rail connection to the Port of Liverpool. I understand it's your pet project, but HS2 and the need for interconnectivity are entirely designed with through services in mind. Sorry to say, but Liverpool is in a geographically inconvenient location, and would be nothing more than a spur of the wider HS network, built at huge cost without the benefits of through running that Manchester will provide. There's no additional cost benefit to it as a through route, not least because the port you keep going on about needs freight capacity rather than passenger traffic. The only way that's achievable would be to route freight traffic onto the Merseyrail network, with the associated clogging of an already busy network. The business case for an extended subterranean tunnel would not stack up - the GVA would be paltry without proven sea traffic flows to back it up. I'm not sure what exactly you expect HS rail to deliver to the Port of Liverpool. HS1 isn't exactly teeming with freight to Dover and Folkestone - that nearly all fits just fine into the national network's capacity - so what makes you think companies are going to want to throw money at domestic HS transport to a terminal on the West Coast, miles away from their main markets in London and the Southeast, when more convenient locations exist elsewhere with the capacity to handle further growth? The proposed traffic flows to Liverpool2 have yet to be proven in the light of the widening of the Panama Canal, and it may prove to be a white elephant. Liverpool simply isn't in a geographically suitable location for freight anymore, due to its restrictive surroundings (the same reason Folkestone continues to go from strength to strength, and the Port of London is gradually moving further and further down the Thames estuary) and distance from the UK's main goods customers. That is why its growth has stagnated in recent times. I'd go as far as to say that Liverpool2 has been built to stave off decline rather than cater for growth - a nice shiny infrastructure project to show investment in an area while patching over the underlying issues of peripherality. All that really leaves is cruise liner traffic, which is hardly a sustainable case for high-speed rail. I live in the biggest city in the East Midlands, but I accept that not everybody can be served directly by the new network. I don't mind a 20-25 minute connecting journey to the station at Toton, because I accept it's in a more strategically suitable location. Open your eyes to the regional picture, and drop the weird obsession with the Port. It has no business case with regards to high speed rail, while the case for the wider city is itself limited.

John   19/07/2017 at 23:50

@J, Leicester `John, you vastly overestimate the need for a high-speed rail connection to the Port of Liverpool` Your knowledge of the port appears to be about nil. The second phase of the new container terminal has been announced. Shipping patterns are expected to change with the opening of the widened Panama Canal. Freight will not run on high-speed lines, the lines will takes trains off the existing lines into the city/port. If you think that Liverpool is in a geographically inconvenient location, the most central city in the UK, you need to look at a map.

J, Leicester   20/07/2017 at 09:17

John, your posts read increasingly as those of a bitter Liverpudlian upset that Manchester happens to be in a better location. I understand there's a rivalry between your two cities, but take the rose-tinted spectacles off for a moment and look at the facts. There is no proof that shipping patterns are going to change. I'm fully aware of the "second phase" of the Port of Liverpool developments - what I'm telling you is that the shipping traffic you're expecting to materialise will not, at the very least not to the point of warranting major investment in the city's rail capacity (though I won't deny that such a move is a good thing). The vast bulk of new traffic is going to go to the Port of London, Southampton and Felixstowe, because it's closer to the main markets that traffic serves. Bulk freight is far more expensive to ship via rail per mile than ship, even in the USA where consists are regularly more than a mile long - so why would ships stop on the west coast and ship it the rest of the 200-plus miles to London, the Southeast and the continent by train at extra expense? Liverpool simply doesn't need any extra capacity - there isn't the growth there to warrant a whole new terminal. It's completely speculative. I'd recommend you check the map yourself. Liverpool is out on a limb on the west coast. The only feasible onwards connections it would provide would be to rural North Wales and to Ireland, both of which would require eye-wateringly expensive tunnels to have any benefits over existing services. There is ZERO logistical benefit to the wider HS network running to it, beyond shipping passengers faster to the Manchester terminal. You're deluded if you think its location is "central".

John   20/07/2017 at 12:08

Liverpool cares not a jot about other cities, as they have their own city run. The Liverpool City Region is over 2 millions strong. The UK is building a high-speed network that `has` to go to Liverpool. The designers of HS2 did not even know of the new Liverpool container terminals. The port is also expanding its boimass facilities. All needing rail. HMG policy is to shift as much to rail as possible. Liverpool has more container shipping company offices than any other city. They are not set up there for nothing. Maersk moved from London to Liverpool. The recent widening of the Panama Canal is changing trade and shipping patterns. Also the North West passage will be operational for 3-4 moths per year. They will use LIVERPOOL. The Liverpool container terminal was opened to coincide with widening of the Panama Canal. Your knowledge of these matters is poor for sure. BTW, the population from North Wales in the west to Hull in the east is the equivalent of a decent sized European country. The Liverpool container terminal was PRIVATE money. HMG is not doing its part by ensuring the port has the transport infrastructure. Private investment does not spend all this money for nothing. They see the future. If HMG do not back such investment others will shy away from the UK, ans that includes UK based companies. The east of Manchester is baren inhospitable moorland. It is difficult to get over, especially in winter. It could be a sea. Look at Google Earth. Look at the links from Manchester to Sheffield which is not that far. Very poor because of the geography, by road and rail. Liverpool IS the most central large city in the UK, that is a fact. The only deep water port on that coast. Maps are good, look, and you will see North Wales to the south west of the city region. Do you know of those people? The Welsh. They are ones who have not got one mile of electrified track while a few cities in England are getting the fastest high-speed network in the world. To the west of Liverpool is a European capital city of around 2.5 million. The half way point to Dublin is Holyhead. There was to be a Dee crossing and a massive junction and spur was built to it off the M53. Of course it was canned. The mangers of the Port of Liverpool have continually complained about HS2 being omitted from the city. Liverpool is not a Newcastle or Plymouth. The route of HS2 was a pure political decision, it clearly was not based of the `future` of the UK. The criticisms of the project are vast and well justified.

John   23/07/2017 at 09:10

HMG has spent £2.3 billion on HS2 so far, and haven’t yet laid an inch of track. The money has gone on fees. That money would have finished off Liverpool's Merseyrail metro (one third was not built in the 1970s with tunnels and trackbed awaiting tracks and trains) and at least gone a very long way into giving Leeds a tram network. In 2010, HMG said that HS2 would cost £32.7 billion. Now, it says £55.7 billion. A DfT report released last week puts the cost of the whole track, as far as Leeds and Manchester, at £104 billion alone, not stations and trains. £400 million for each mile. This will end up a ludicrous network that does not even run into Birmingham's main station, has a station at Manchester Airport that is only accessed via London & Birmingham, needing a bus to get people to the terminal building and serves only FOUR cities directly. I could go on and on about the ludicrous design.

John   23/07/2017 at 13:57

+J, Leicester When the Phase 2 route was announced in January 2013, documents were issued outlining the economic case for HS2s route. A 300 page document had only `2` pages on linking Liverpool to HS2. They had London, Birmingham, Manchester and Leeds on the their radar and if others could be fitted in then fine. The budget did not include Liverpool. All the same, the argument has always been that the benefits of direct connection to HS2, though significant, do not justify the cost of providing the infrastructure. Poor excuses were given like HS2 cannot accommodate people from Runcorn to London, so the Liverpool train will have to stay on the WCML to Crewe. They never even took int account the Wirral opposite Liverpool. In short they just dismissed the city region, of over 2 million, out of hand with no serious consideration.

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