CP's request for risk-share deal rebuffed

CP's request for risk-share deal rebuffed

Govt hands railway consortium deadline

The Transport Ministry has rebuffed a request from the Charoen Pokphand (CP) Group that the government share the risk in building the 224-billion-baht high-speed railway linking three main airports.

Transport Minister Saksayam Chidchob said the government had to follow the legal framework set down in the official request for proposal (RFP), which states the project bid winner must bear all the risk.

The framework left no room for additional investment conditions to be made, he added.

The minister was responding after CP senior chairman Dhanin Chearavanont said on Sunday that certain points in the terms of reference for the public-private partnership (PPP) project were not practical. The CP conglomerate insists the government should share the risk.

Last month, it was reported that the CP-led consortium (CP), winner of the bid to construct the high-speed railway linking Don Mueang, Suvarnabhumi and U-tapao airports, must sign the contract on Oct 15 or else face a fine for failing to honour the bid terms. The consortium comprises Bangkok Expressway and Metro Plc, China Railway Construction Corporation Ltd, Ch Karnchang Plc, and Italian-Thai Development Plc.

The ultimatum was earlier decided upon at a meeting between Deputy Prime Minister Anutin Charnvirakul, who oversees the Transport Ministry, Mr Saksayam, senior transport officials and the chief of the Eastern Economic Corridor Office.

On Monday, Mr Saksayam said the government has absorbed part of the investment costs, including by expropriating land. An estimated 72% of the land needed for the railway project will be ready for handover on the day of the contract signing.

CP received a draft contract for the project on Oct 1 and has made no official request to amend it.

"The contract must proceed as planned on Oct 15. If no contract is signed on that date, the Transport Ministry will recall the project and consider demanding compensation from the company for abandoning the project," he said.

Mr Saksayam added that by missing the deadline, the CP-led consortium would also risk being blacklisted and deprived of the right to enter bidding for future state contracts.

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