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1. LCQ18: Chek Lap Kok airport project

2. Traffic arrangements facilitating KCR works implement tomorrow

3. Award of Airport Expansion Contract to Balfour Beatty Group

1. LCQ18: Chek Lap Kok airport project

Following is a question by the Hon Emily Lau and a written reply by the Secretary for Economic Services, Ms Sandra Lee, in the Legislative Council today (April 10): Question: Regarding claims against the Airport Authority by contractors in relation to the Chek Lap Kok airport project, will the Executive Authorities inform this Council of: (a) the number of such claims that were settled in the past 24 months, the nature of each claim and the total amount of compensation involved; (b) the comparison between the amount of compensation as settled in each of such claims and the original estimate of the contract from which the claim arises; and (c) the number of claims still unresolved and the estimated contingent liability? Reply: Madam President, During the past 24 months (i.e. April 2000 to March 2002), the Airport Authority has settled a total of 6 779 claims relating to 30 airport related contracts. Of the 6 779 claims, 3 745 arose from variations to works, for which the contractors could make legitimate claims in accordance with the contract terms. This is a commonly accepted practice, since such variations are normally envisaged in works contracts. The other 3 034 claims fall into the following categories:

Some of the claims above also involve minor additional works and the contractors could make claims for these additional works under the contract. We have no detailed breakdown of these items. The total amount of settlement for all the above-mentioned 6 779 claims was $3,795 million and the original estimates of the contracts from which the claims arose was $22,612 million. As these claims involve sensitive commercial information and in some cases, both parties are bound by a confidentiality clause, the Airport Authority cannot reveal the amount settled for each claim. The Airport Authority is still negotiating with contractors for settlement under four contracts involving 10 claims. As the negotiations are ongoing, the Airport Authority considers it undesirable to disclose the estimated contingent liability concerned.

[Source: Airport Authority Hong Kong, 8 April 2002]

2. Traffic arrangements facilitating KCR works implement tomorrow

To facilitate the works of KCRC's Tsim Sha Tsui Extension, the following temporary traffic arrangements will be implemented at Tsim Sha Tsui from 10 am tomorrow (April 12) for a period of about nine months: * the section of Mody Road between Nathan Road and Bristol Avenue will be temporarily closed to all vehicular traffic; * the section of Carnarvon Road between Nathan Road and Humphreys Avenue will be temporarily re-routed from one-way westbound to one-way eastbound; * vehicles on Hanoi Road northbound will be prohibited from left turning onto Carnarvon Road; * vehicles on Humphreys Avenue eastbound will be prohibited from right turning onto Carnarvon Road; * vehicles on Hanoi Road northbound will be diverted via Carnarvon Road eastbound; * vehicles on Carnarvon Road southbound north of Humphreys Avenue will be diverted via Prat Avenue; and * vehicles on Humphreys Avenue eastbound will be diverted via Carnavon Road northbound or Prat Avenue. Motorists are advised to attend to the traffic signs erected on site.

[Source: Hong Kong Government, 11 April 2002]

3. Award of Airport Expansion Contract to Balfour Beatty Group

Recent award to Balfour Beatty of the HK$420m East Hall Works project at Hong Kong International Airport. Airport Authority adopted a totally new and partnering focused procurement system for this project, and intend to use similar systems for other complex projects at the airport. After a pre-qualification exercise AA shortlisted three tenderers to take part in a "pre-tender development phase" where the shortlisted tenderers were based in AA offices, given full access to the design documentation, allowed to interrogate and propose amendments to the Conditions of Contract, encouraged to take part in VE workshops and to develop their base and alternative proposals with the Authority and its designer. The three tenderers then submitted competitive base tender bids plus alternative bids (using the data they had gleaned in the pre-tender development phase). After a technical and financial assessment the project was awarded to Balfour Beatty. All pre-tender development work was undertaken confidentially and the two unsuccessful shortlisted tenderers were reimbursed a portion of their costs incurred during the process. The two unsuccessful shortlisted tenderers were Gammon Skanska and Hsin Chong Taylor Woodrow JV. The objective of this approach was to give the tenderers a complete understanding of the complexity of this project and the operational constraints before they submitted a price. We wanted to ensure that the winning Contractor fully understood what they were letting themselves in for and that they priced their tender accordingly. We have had some very positive feedback from the Contractors involved in this process.

If you would like any more information please call:
David Brodie-Stedman, Procurement Manager, Tel: 2769 1234, Airport Authority Hong Kong.

[Source: Airport Authority Hong Kong, 8 April 2002]