US$170M for new harbour bridge
An artist’s impression of the low bridge at Houston-Versailles (West Bank Demerara) with three lanes and a movable section
An artist’s impression of the low bridge at Houston-Versailles (West Bank Demerara) with three lanes and a movable section

-feasibility study recommends 250 %, 700% increase in tolls

LIEVENSE CSO’s final report on the feasibility study for the new Demerara Harbour Bridge has put the estimated cost of the project at US$170M and also proposes increases in the tolls to help limit government’s contributions.

According to the report released by the Ministry of Public Infrastructure on Tuesday, the total cost is inclusive of interest for pre-financing and costs during construction. The study which was conducted between January 1, 2017 and August 17, 2017 concluded that the best option would be a low bridge at Houston-Versailles (West Bank Demerara), with three lanes and a movable section to transit seagoing vessels.

Lievense has advised that the bridge be designed with a minimum clearance of 17.5 m above Chart Datum (CD) to allow uninterrupted passing of trawlers, tugs and barges and smaller coastal and service vessels.
A low bridge is reportedly about 20 per cent cheaper than a high bridge (with a reduced height of 43.5 m CD). Compared to the high bridge, the low bridge also has an estimated 15 per cent higher lane capacity and less risk on the breakdown of trucks and cargo fallen off.

The intended design for the new Demerara Harbour Bridge

Without the interest for pre-financing, the bridge’s estimated cost is US$150 million, including contractors cost and additional costs for services, land acquisition for the approach roads, and limited budget for a first phase of link roads.

According to the study, due to the cost, it was concluded that the business case of the project is “financially not viable,” assuming similar toll rates and no contribution from Government. The main reason for this is reportedly the high debt service caused by the short loan periods and high interests in the market.

In order to compensate for this, it was advised that the toll tariff rates be increased to 250 per cent of the 2017 road toll rates and 700 per cent of the present rates for river vessels. “This way the Government’s contribution will be limited to about US$39 million to be paid in five years after commissioning of the project and the project becomes viable,” the report stated.

The recommended project, however, has from a financial point of view a limited safety margin and many factors are still uncertain. Those factors include the contract costs of the design and construction contractor, the final funding costs and interest, the uncertainty in the traffic forecast and thus the revenues, claims and force majeure (greater force).

FLEXIBLE DEVELOPMENT STRATEGY
It was therefore recommended that a flexible development strategy be adopted in order to control risks in cost and revenues by scope management, as this is the only way to influence the costs of the project. Some of the strategies that were suggested include projects such as link roads and viaducts over the bank roads. Although much is yet to be done, the report pointed out that the present bridge is unreliable and lacks the capacity to serve the traffic demand hence a new bridge is required.

“The Demerara Harbour Bridge has been in operation for 40 years and has long passed its technical lifetime. The bridge is no longer able to service the present and future traffic demand,” concluded the Lievense report.

In addition, traffic is estimated to continue to grow at five per cent per annum. The road network in the greater Georgetown area is saturated and the road network adjacent to the present bridge is not able to serve the present and future traffic demand, therefore new linking roads are required to fully use the new bridge’s capacity.

A pre-feasibility study carried out in 2013 proposed three alternative locations, Houston, Peters Hall (the existing location) and New Hope, to construct a new bridge. The Houston–Versailles location was the recommended location because, according to the report it has the highest socio-economic cost benefits (highest benefits for invested money); much lower urban and environmental impacts than other locations.

ISSUES TO BE RESOLVED
Though it had the lowest investment cost, the report cited some issues to be resolved, which include the resettlement of some houses, and efforts to minimise the impact to the Muneshwer terminal, as well as to the PSI Fishing terminal which will be adjacent to the bridge. On the West Bank, the Government was advised to pay attention to mangrove fringe crossing, the current drainage channel and a timber company. Additionally, procedures for navigation have to be reconsidered and new lead lines developed.

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