Saturday, September 08, 2007

Korean firm to study Vietnam expressway feasibility

Korea’s Byucksan Corporation is set to submit a proposal to the Ministry of Transport next week on conducting feasible study for a new major highway project connecting south and central Vietnam.

According to Byucksan, it is expected to take one year to complete the feasible study on the Dau Giay – Lien Khuong highway, which will run form the southern province of Dong Nai – a Ho Chi Minh City neighbor – to the central highlands province of Lam Dong, home to several tourists cites around provincial capital Dalat.

Such a study would be basic for the group, or any other, to consider investment in the project.

The 189km four-lane highway is estimated to cost VND9.1 trillion (US$560 million).

The central government approved earlier last month a transport ministry project to build a billion-dollar expressway between Ho Chi Minh City and Dong Nai province.

The Vietnam Expressway Corporation (VEC), a ministry subsidiary, will build the 55 km Ho Chi Minh City-Long Thanh-Dau Giay highway.

The VND18.88 trillion ($1.2 billion) road will initially be four-lane before being widened to eight.

Land clearance will be completed in the first quarter next year and construction started in the second quarter. It will be ready by 2010.

As planned, oil and gas group PetroVietnam, the Vietnam Post and Telecoms Group, Coal and Mineral Group, and Vietnam Shipping Building Corp and the Bank for Investment and Development of Vietnam will join hand with VEC to develop the project under a BOT (Build-Operate-Transfer) contract.

They plan to set up a shareholding company, the HCMC-Long Thanh-Dau Giay Expressway Joint Stock Company will begin operating with VND1.8 trillion ($112.3 million) in capital.

Funds will be mobilized domestically from individuals and banks rather than the government.

The Japan Bank for International Cooperation and the Asian Development Bank have agreed to provide a $600 million loan.