[Peetwo]

  
And then the (potentially) good story on the 2nd Sydney airport project.
Via the Oz:

Coalition locks in Badgerys ‘Plan B’

12:00amSIMON BENSON

The Turnbull government has ­finalised funding contingency plans to build Sydney’s $6 billion second airport.

The Turnbull government has ­finalised funding contingency plans to build Sydney’s $6 billion second airport, amid expectations that Sydney Airport Corporation is unlikely to take up the May 8 deadline offer to build and operate Badgerys Creek.

The Weekend Australian understands the government has modelled several funding options, including one based on the Snowy Mountains Hydro-electric Scheme, in which the government would become the principal shareholder in a company set up to operate the ­airport.

An off-budget NBN Co-style model is also on the table. Under a government business enterprise model any debt raised to build and operate the airport would be offset by the government retaining equity in the airport, meaning it would not be included under normal budget spending.

It would also give the government the option to sell the airport, which would represent a significant piece of national economic infrastructure, once it is operational and passenger volumes guarantee commercial returns.

Sources have confirmed that the government is preparing for an almost immediate start to construction, with a timetable of next year for major earthmoving works to begin.

It is likely that an announcement on the government’s plans, which would end Sydney Airport’s stranglehold monopoly on commercial air travel in Sydney, would be announced shortly after the May 9 budget.

The industry is widely anticipating that the Sydney Airport Corporation, under its parent company Southern Cross Airport Corporation Holdings, will not take on the project. The deadline for a decision is due on the day ­before the budget.

Sydney Airport Corporation has argued that Badgerys Creek is not commercially viable without significant government assistance.

The government has refused to provide any funding for a ­private-sector operation, arguing that it is offering a “once-in-a-generation” deal for a 99-year lease on a 1700ha greenfield site in western Sydney, with a full airport masterplan that had passed every environmental and regulatory hurdle.

It is also spending $3.6bn on a western Sydney infrastructure plan for “ground transport connectivity” to the airport, including a scoping study for a metro rail line from the CBD to Badgerys Creek.

Urban Infrastructure Minister Paul Fletcher issued a notice of intention to SAC in January giving it until May 8 to notify the government of its intention.

Mr Fletcher has previously said that the government began planning late last year for the possibility that responsibility for construction would fall to the government.

He said the government ­“certainly had the capacity” to fund the airport.

When Sydney’s main airport, Kingsford Smith, was privatised in 2002 its market capitalisation was about $5bn. It is now three times that amount.

“It’s in the hands of Sydney Airport Corporation,” Mr Fletcher said. “If it chooses to take up the right, it will build and operate; if it doesn’t, then we stand ready to do so.”

Under the 2002 privatisation contract of Kingsford Smith Airport at Mascot, the company was granted first rights for the construction of a second airport in the Sydney basin.

The plan the government drew up sets a strict mandated timetable for the construction of the airport to ensure start of operations by 2026. “Failure to meet” milestone deadlines include significant ­financial penalties.

Airlines are believed to favour the government option over concerns that Southern Cross Airport Corporation Holdings would be handed an expanded monopoly should it decide to build Badgerys Creek, leaving no competition to bring down what are commonly regarded as excessive landing fees.

Sydney Airport said it was still in the process of evaluating the ­notice of intention and would try to meet the May 8 deadline.

It is expected that Sydney Airport Corporation will push the government for expanded runway operations at Kingsford Smith and changes to the curfew, arguing that Badgerys Creek would be a 24/7 airport.

An industry source said that Sydney Airport had expected the government would partly subsidise construction of the new airport but was “blindsided” when this was ruled out. The notice of ­intention issued by the government required that the airport needed to have at least one 3.7km runway, capable of landings for an A380, with a terminal capable of meeting passenger movements of 10 million a year.

Earthmoving works to level a field that currently has a 30m undulation, estimated to cost at least $1.3bn, are required to be underway by next year.

Industry sources said that several institutional investors had been looking at the project. It was not expected that any would take on the contract, despite industry super funds owning or having large stakes in other major airports around the country.

Update 22/04/17: Via the Oz

Canberra set to go on airport

12:00amSIMON BENSON

The government has met construction companies, a sign it is preparing for an immediate start on Sydney’s second airport.

The federal government has met with nine of the country’s largest construction companies in the past three weeks, a sign that it is preparing for an immediate start on Sydney’s second airport, should it be left to take on the $5 billion project.

Ahead of a May 8 deadline for the Sydney Airport Corporation to say whether it will knock back its option on the Badgerys Creek airport, Urban Infrastructure Minister Paul Fletcher revealed yesterday that he and federal offic­ials had met construction firms as part of the government’s contingency planning.

“If (SAC) does not accept the notice of intention, the Turnbull government is ready — and we have done a lot of work so that we can ensure our timetables are met,” Mr Fletcher told the Committee for Sydney. “I am personally very confident that there is strong interest in this project from the construction sector.”

The Weekend Australian revealed last Saturday that several funding options were being considered should the government take on construction, including models based on the corporatised Snowy Mountains Scheme or an off-budget NBN Co model.

Mr Fletcher said the government was “working hard to meet our goal of the airport being operational by 2026”.

In 2014, the then Abbott government­ pledged to build Western Sydney Airport after a community push for the city’s second­ major airport.

Mr Fletcher said the federal and NSW governments were “well advanced on a scoping study” into the rail needs of western Sydney and the airport. Badgerys Creek is about 50km west of Sydney’s CBD.

“What is the right route, when should it be built, how much will it cost and how should it be funded? The discussion paper issued last year has generated considerable interest,” he said. The study is to report back this year.

Mr Fletcher said work in progress at the site would ensure it was “completely empty so that it is ready for construction”.

“We have put a lot of effort into tracking community sentiment concerning Western Sydney Airport. According to our most recent data, over 80 per cent of people in western Sydney support or are neutral to the new airport.

“This data is supported by the feedback I received when, earlier this year, I met individually with all of the councils in the areas ­surrounding the airport: Blacktown, Blue Mountains, Camden, Campbelltown, Fairfield, Liverpool, Penrith and Wollondilly.

“While some councils maintain a formal position of oppos­ition to the airport, that is not the majority sentiment which I detected­ in these meetings.”

He said the airport would not be “designed by public servants in Canberra”. The government would weigh its options to deliver an airport by 2026. If it took on the project, the next steps would be indicat­ed very soon.

Mr Fletcher said the airport would generate almost 9000 direc­t jobs by the early 2030s and 60,000 jobs long-term.

It will feature a 3700m runway capable of carrying large commercial passenger aircraft, including the A380 and 747. The terminal will have capacity for 10 million passengers a year.

Hmm...wonder if Wagners feature on the EOI construction company list...


MTF....P2