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The $11 billion Metro Tunnel's independent cost advisers have warned its financial backers the project could face many millions of dollars in extra costs and months of delays due to the COVID-19 pandemic.
The Andrews government's flagship rail project has already blown out by up to $3 billion, but leading quantity surveying and construction cost management consultancy WT Partnership has told the project's financiers to expect new coronavirus-related costs and delays.
Work on the Metro Tunnel is likely to be delayed due to coronavirus.CREDIT:JUSTIN MCMANUS
“The advice is productivity is down,” the company’s executive director David Stewart said in an exclusive interview with The Age. "A conservative view is the delay would be weeks, but it may be months ... which may result in millions of dollars in delay costs."
Other major transport projects such as the $6.7 billion West Gate Tunnel are not immune from coronavirus delays plaguing the construction industry, due to new safety measures and a slowdown in construction material imports.
There will be “a day of reckoning” after the pandemic subsides, when the government, developers and builders involved in construction projects across the state must evaluate who pays for the delay costs. Each party will have to demonstrate how they mitigated these problems to avoid liability down the track.
“There will be productivity issues caused and that applies to the Metro and West Gate Tunnel, it’s not rocket science to know these measures will slow things down," Mr Stewart said.
"We have flagged with the financiers and they would know that given the coronavirus there would be reduced productivity and consequently, there will be additional costs to be determined once we know what the end date is."
WT Partnership is the 'independent certifier' for the Metro Tunnel's construction consortium, the Cross Yarra Partnership, meaning it issues and approves payments financiers make to the builders and advises on construction cost risk.
The consortium claims it is working as fast as is legally possible on the project and new rules allowing 24-hour-a-day works in the city would help ramp up construction, Mr Stewart said.
Notices of delay have been issued "at large" by builders across the industry, Mr Stewart said, with the specific details about delays and costs yet to be determined.
This article first appeared on www.theage.com.au
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