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Operator award for the Shatin to Central Link & Feasibility study of railway merger

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The Chief Executive in Council approved the award today (June 25) of the Shatin to Central Link to the Kowloon-Canton Railway Corporation (KCRC).

The Shatin to Central Link is a rail project recommended in Government's Railway Development Strategy 2000 (RDS-2000), linking up the Northeast New Territories and the Central Business Area. Its target completion date is set for 2008-2011.

A Government spokesman said; "This Link will increase significantly the cross-harbour and Shatin-Kowloon rail capacities and help to re-distribute the flows and relieve the other railway lines in particular the Tsuen Wan Line. More than one million people along the East Rail and Ma On Shan Rail catchment can choose to use this rail link to go to Southeast Kowloon or cross the harbour more conveniently."

According to RDS-2000, the Shatin to Central Link and other new rail projects, which are not natural extensions of the network of any particular corporation, shall be subject to competitive bidding.

"To ensure a level playing field competition, the award is based on proposals fully conforming to all Government's specifications and an objective assessment exercise has been conducted. The assessment has considered the proposals' overall performance in respect of passenger convenience, land resumption, environment, traffic, integration with existing and planned landuse, earlier completion of the whole or any part of the Link, fare level, funding support required and other aspects. No share holding interest in individual Corporations has been factored into the bid assessment," the spokesman said.

"Both Railway Corporations submitted very competitive bids, with project costs some 15 per cent lower than the respective estimates in the Second Railway Development Study. Both bids perform comparably in overall technical terms. However, KCRC's bid fares better financially as it attracts higher patronage level, sets a lower fare level, generates higher returns on investment and requires no funding support from the Government including the grant of above stations/depot property development rights. KCRC is therefore awarded the right to operate SCL," the spokeman said.

"It will bring more overall benefit to the community," he added.

"Following the award, discussions with KCRC will follow to firm up the project scope later this year. In this context, we will consider any enhancement features in KCRC's non-conforming proposal as well as other proposals to explore the possibility of providing additional stations and linkages to serve more population centres such as Whampoa, Tsz Wan Shan and Hin Keng.

"We will strive to speed up the work, where practicable, in order to implement the project as early as possible for completion in the early part of the 2008 - 2011 time window. This will also help boost the economy and create about 12,000 job opportunities during the construction peak in the few years to come." the spokesman added.

As a separate issue, the Chief Executive in Council has also instructed the Administration to consider the feasibility of merging the MTRCL and the KCRC into a single rail company. The Administration will undertake this study as a matter of priority, taking into account its transport policy objectives, the interests of long-term railway development in Hong Kong, and the wider legislative and economic implications. Recommendations on this will be made to the Executive Council in due course.

End/Tuesday, June 25, 2002

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