IVRCL Raipur Bilaspur Tollways Limited

cancelled

On 30th November 2011, the National Highway Authority of India (NHAI) awarded a 25-year concession (including construction period of 30 months) to IVRCL Assets & Holdings for the strengthening,improvement, four/six-laning,operation and maintenance, and tolling of 126.5 kms of Raipur-Bilaspur section from km.0.00 to km.127.65 of National Highway-200 (NH-200) in the states of Chattisgarh. Under the contract, IVRCL was responsible for the design, construction, finance,operation and maintenance and strengthening of the existing 4-lane carriageway to a four/six-lane highway with paved shoulders. The scope included construction of 4/6-lanes including construction of new pavement, rehabilitation of existing pavement, construction and/or rehabilitation of major and minor bridges, culverts, service roads, road intersections, interchanges, toll plaza, tunnel section, etc.The expansion project was part of National Highway Development Project Phase-IV. IVRCL established IVRCL Raipur Bilaspur Tollways Limited (IRBTL), a special purpose vehicle in December 2011, to implement the project. The SPV won the tender through international competitive bidding, conducted by NHAI, by quoting the highest annual premium. The SPV would would pay NHAI a sum of US$ 8.5mn (INR 454.5mn @53.4 INR/USD) in the first year of operations with 5% increase in each subsequent year (This amounted to an NPV payout of about US$ 121.4mn over the life of concession period at a discount rate of 10%). Of the 33 pre-qualified bidders, about 17 developers finally bid for the project. Under the contract, the SPV was to recover the capital costs and operating costs including returns through tolling during the term of concession. The EPC contract for the project had been awarded to IVRCL Limited. Construction on the project was expected to began in July 2013 (expected appointed date) and was expected to be completed by January 2015. However, due to delay in land acquisition, the concessionaire failed to meet the construction deadlines. Moreover, given the subsequent slowdown in Indian economy, the sponsors found the road not very viable (given an aggressive premium bid by IRBTL). While discussion of restructuring of premium payment was going on with NHAI, in February 2014 NHAI finally cancelled the concession for the project. The concession agreement was signed on 25th January 2012. The estimated cost of the project at the time of bidding was US$ 227.7mn (INR 12160mn @53.4 INR/USD). Funding closure had not been achieved at the time of cancellation of the project.