Cost of round-Baku highway estimated at nearly $50mln

Business Materials 21 April 2006 12:37 (UTC +04:00)

Estimated cost of construction of round-Baku highway today is $49.5mln, deputy minister of transport Musa Panakhov told Trend.

Panakhov said the prices set by companies under the construction tender were much higher than the project estimate and the tender was canceled. Additional conversations will be held in order to select the company to perform feasibility study.

Javid Gurbanov, head of Yolnagliyyat servis department with Ministry of Transport, said the companies tender offer prices reached $83mln. In total 15 companies were partaking in the tender. At the moment Azerbaijans participation in the project is estimated at $33.5mln.

Transport Ministry representative said some communication transfer should be performed during the road construction. Communications of 24 agencies being agreed at the moment are crossing the future road route.

The project cost was adjusted upon the study performed by designer, Arab Consul of Jordan. The cost rises due to necessity in communications transfer and construction of a 5 km long road section and some infrastructure not foreseen in the previous feasibility study. In particular, it is planned to lay a new overpass to connect the road to the new bus station complex. A number of errors was made while making TEO on this project in mid-90s. Besides, prices for construction materials and services rose significantly since then.

The project was planned to execute at the cost of Kuwait Development Fund with its $14.9mln credit, Arab Development Fund of Abu Dhabi with $10mln and Azeri government with $3.5mln. Arab financial institutions issued credits for 20-year period with 4-year period of grace at 2.5% annual interest.