Kosi Bridge NH - 57

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In October 2006, the National Highway Authority of India (NHAI) signed a 20 year contract (including 3 years of construction period) to India’s Gammon Infrastructure Projects Limited (Gammon) to construct and operate the 10.6 km section (including a Major Bridge of 1.875 kms across the river Kosi) on National Highway 57 (NH57), in Supaul district of state of Bihar. Under the contract, Gammon was responsible for the design, construction, finance, operation and maintenance of 4-lane Bridge across river Kosi including its approaches, the guide bund and afflux bund. The project, part of National Highway Development Project-Phase II, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. The project stretch was a vital link connecting the northern states of India to the north eastern states. Gammon established Kosi Bridge Infrastructure Company Limited (KBICL), a special purpose vehicle, to implement the project. Gammon won the tender through a competitive tender, conducted by NHAI, by requesting for the lowest annuity payments. Under the contract, Gammon was to recover the capital costs and operating costs including returns by way of a fixed annual payment (annuity) from the NHAI in the amount of US$ 15.95 million during the concession term (excluding three years of construction period). Under the annuity scheme, KBICL cannot collect tolls from the users of the facility. The project reached financial closure in July 2007 with a debt equity ratio of 8.1:1. The total capital cost of the project was estimated at US$ 109.89 million. Canara Bank has syndicated entire debt of US$ 98 million and also is the leader of the consortium of lenders. Construction on the project was scheduled to begin in April 2007 and was expected to be completed by April 2010. None None