Withdrawal of preferred bidder delays City Rail Link tender

Fletcher Building [NZX:FBU] won’t comment whether it is the preferred bidder that this week caused up to a three-month delay in the main construction contract for the $3.4 billion underground city rail link.

City Rail Link, the joint venture between Auckland Council and the government, which is building the underground central city rail link, said yesterday the withdrawal of one of two preferred bidders would delay the release of the tender documents by up to three months while discussions were completed with a new preferred bidder.

The project’s eight original bidders were Fletcher Construction, Acciona Infrastructure New Zealand, Bam International Australia, China Machinery Engineering Corporation joint venture, CPB Contractors, Ferrovial Agroman (New Zealand), Salini Impregeilo SPA and Vinci Construction Grands Projets SAS (VCGP) joint venture.

“We are fortunate the initial lineup of eight bidders for the project was exceptional and it was a hard choice to determine the top two,” CRL chief executive Chris Meale said in a statement.

Fletcher Building, which last week said its troubled building and interiors unit would not bid for new work, said in a statement today that it was “not for us to comment on the CRL 3 procurement process.

“When we do bid for infrastructure projects, we are bound by very strict probity and confidentiality obligations to the client. We also tend to bid major infrastructure projects with other consortium partners, and we are also bound to maintain confidentiality in our agreements with these parties,” the company said.

But for clarity, it said the decision on ceasing bidding by B&I doesn’t impact its infrastructure business and it will continue to bid for infrastructure work assuming it provides an appropriate risk and return.

CRL spokeswoman Carol Greensmith says the up to three-month delay is an estimate of how long it will take the next preferred bidder City Rail Link is in discussion with to “come up to speed” and could include incorporating some of the parties involved in the withdrawn bid.

All eight shortlisted companies included national and international elements, she said.

The billion-dollar-plus tender is the main contract for the project and involves building the three main stations at Mt Eden, Karangahape Rd, mid-town Wellesley St and the tunnels in between. Work is due to start next year.

One of New Zealand’s largest ever transport projects, the 3.4 kilometre underground train line will run from Britomart station in downtown Auckland through the CBD to connect with the existing western line at Mt Eden station.

CRL said it was too early to say if the tender delay would roll on to the current project completion date of early 2024.

The two other main contracts awarded so far were to two joint ventures – Downer NZ and Soletanche Bachy and Connectus, a joint venture between McConnell Dowell and Hawkins.

The Downer joint venture designed the rail link work through and under Britomart Station and Queen St to Precinct Properties’ Downtown Shopping Centre site while the Connectus consortium is constructing the cut and cover tunnels under and along Albert St from Customs St to Wyndham St.

The total value of contracts awarded so far is $317 million, CRL says.