NRW in Forrestfield Link win

18/02/2016 - 13:13

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Perth contractor NRW Holdings has had a major boost, with the state government selecting the company's joint venture with Italy’s Salini Impregilo as preferred contractor for the $2 billion Forrestfield-Airport Rail Link.

NRW in Forrestfield Link win
Imagery of the Forrestfield Station concept plan.

Perth contractor NRW Holdings has had a major boost, with the state government selecting the company's joint venture with Italy’s Salini Impregilo as preferred contractor for the $2 billion Forrestfield-Airport Rail Link.

The project marks the first entry to the WA market for Salini, which operates in more than 50 countries with 35,000 employees.

For NRW, the project will cushion the impact of the deep slowdown in iron ore and coal projects, whic have been its major focus.

The joint venture will be responsible for the design, construction and maintenance of the rail and tunnel project.

NRW said the final contract value remains subject to negotiation.

It was selected ahead of two other proponents – one featuring John Holland and Leighton Contractors, while the other comprised Spanish players Acciona Infrastructure and Ferrovial Agroman, and Dutch company Bam International.

The contract is expected to be finalised by May of this year, with negotiations between the joint venture and the Public Transport Authority imminent.

Transport Minister Dean Nalder said he envisaged the contractor would mobilise on site in the coming months.

"This is an incredibly exciting time for a project that will change the way the people of Perth, and in particular Perth's eastern foothills, travel to our city,” he said.

"Planning for this transformational project is well advanced."

For NRW, it will be a major win, with the contractor one of the worst hit by the mining downturn.

Business News reported earlier this week that NRW had one of the poorest debt ratios of the state’s contractors, and had suffered a total shareholder return of about minus 50 per cent in the past five years.

It additionally suffered from a major legal battle with Samsung C&T over a railway build for the Roy Hill project, which contributed to cost-cutting measures within the company.

The two eventually agreed to a $30 million out of court settlement.

In January, chief executive Julian Pemberton took a 40 per cent pay cut to $800,000 per annum.

NRW’s JV partner, Salini, is involved in another major rail project in Australia, the Sydney Metro North-West, which includes a large tunnelling portion.

The Forrestfield-Airport rail line is due to open in 2020.

It will have three new stations, one at Airport West near Redcliffe, one at the new airport terminal, and a terminus at Forrestfield.

NRW was in a trading halt today pending a release to the market, which was lodged after 5pm Perth time.

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