Dragages wins $10.3b border crossing tunnel job

Projects, Slider 08 Jan 2014
Dragages wins $10.3b border crossing tunnel job

Lung Shan Tunnel will be Hong Kong’s longest road tunnel

French contractor Dragages Hong Kong has been awarded the principle contract on the Liantang/Heung Yuen Wai Border Crossing Point project, the Lung Shan tunnel worth HK$10.3 billion.

The Civil Engineering and Development Department confirmed on Monday the award of Contract 2 to the Hong Kong subsidiary of French contracting giant Bouygues Construction after enquiries by Construction Post last week.

In what some people may regard as the ultimate case of Christmas coming early, Dragages was informed about the award before the holiday, according to information obtained by Construction Post last Thursday from an industry source.

“As Dragages seem to be the tunnelling ‘go to’ firm in Hong Kong, it wouldn’t surprise me if your intel was spot on,” another industry source said when asked about the award.

Last week, a briefing paper submitted by the government to the Legislative Council’s Panel on Development on top-up funding of HK$8.55 billion for the approved project estimate advised that three contracts were currently in progress, including Contract 2.

The contractors for the other two contracts, Contract 3 and Contract 5, have already been announced but up to Monday, the government had yet to say who had won Contract 2.

Even so, Dragages appeared to have indirectly confirmed the award after placing an advertisement for multiple site staff in the Classified Post job section last Saturday.

Dragages will be responsible for building a dual two-lane trunk road comprising the 4.8 kilometre Lung Shan Tunnel from Fanling Highway interchange to the proposed Sha Tau Kok Road interchange.

Other associated works include an administration building, three ventilation buildings and electrical and mechanical works in the tunnel.

On completion in 2018, it would the longest road tunnel ever built in Hong Kong.

While the award may be good news in terms of turnover, Dragages may be pressed for time on the contract.

Work was supposed to start in May 2013 after tender submission in January according a tender notice published in the government gazette in November 2012.

In the event, the final tender submission date was in April 2013 after the tender period was extended twice.

Indeed, the government’s briefing paper advised that increased costs, concern over ground conditions and the expectations of increased project risk pushed up the tender prices for the project, hence the need to increase the approved project estimate.

Lung Shan Tunnel for Contract 2 will start at the foot of Lung Shan Hill  (on the left of this picture) near the Fanling Highway interchange and end at the proposed Sha Tau Kok Road interchange 4.8 kilometres away  (Danny Chung)

Lung Shan Tunnel for Contract 2 will start at the foot of Lung Shan Hill (on the left of this picture) near the Fanling Highway interchange and end at the proposed Sha Tau Kok Road interchange 4.8 kilometres away (Danny Chung)

For the tunnel, of which there is a total length of 5.7 kilometres, the estimated cost shot up from HK$3.94 billion to HK$6.35 billion, an increase of 61 percent.

For the tunnel building, the estimated cost went up 29 percent to HK$430.2 million while the costs of the ventilation adit and buildings soared by 89 percent to HK$1.18 billion.

Poor ground conditions means that the company will have tread carefully.

The briefing paper said there were a number of faults straddling a stretch of the tunnel of some 1.4 kilometres in length.

This will necessitate more extensive temporary works such as grouting, shotcreting, temporary structures and strengthening works of the permanent lining along this tunnel section.

In addition, a longer-than-expected stretch of mixed ground would mean slower going for the tunnel boring machine (TBM) as the contractor grapples with slower rate of construction, higher construction risk, more wear and tear for the TBM and the need for more temporary grouting work.

“In summary, the poor ground condition encountered for tunnel has caused an additional cost of about HK$698.6 million, which represents 4.3 percent of the original approved project estimate of [the project] or 8.2 percent of the proposed total increase,” the briefing paper said.

The latest award caps a very good 2013 for Dragages.

In July, the company in joint venture with its parent bagged the showcase tunnel contract for the Northern Connection of the Tuen Mun-Chek Lap Kok Link worth HK$18.2 billion, the biggest award for a single contract in recent years.

Later in November, Dragages’ Macau unit won a contract worth HK$3.68 billion to build a luxury hotel within the City of Dreams entertainment complex developed by Melco Crown Entertainment (6883).

In May 2012, Dragages in joint venture with China Harbour and VSL won the Hong Kong section of the Hong Kong-Zhuhai-Macao Bridge project worth HK$12.9 billion.

The company, in joint venture with its parent, is also doing the Mei Lai Road to Hoi Ting Road Tunnels and the Shek Yam to Mei Lai Road Tunnels of the Express Rail Link project for the MTR Corporation (0066).

With such quantity of high-profile work on its books, one wonders if Dragages can take on additional projects.

The MTRC is currently in preparation for future tendering of the Cross Harbour Tunnel contract for the Shatin to Central Link, a showcase tunnelling job that presumably Dragages, not to mention rival contractors, would be keen to win.

Danny Chung


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