XN000022-1986-06-18 — Page 2

WEDNESDAY, JUNE 18, 1986

PIPELINE DECISION SAVES $5.71 MILLION

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A DECISION BY THE FINANCE COMMITTEE WILL SAVE TAXPAYERS $5.71 MILLION ON A SUBMARINE WATER PIPELINE THAT WILL NOT BE NEEDED UNTIL 1993.

THE FINANCE COMMITTEE TODAY (WEDNESDAY) APPROVED WILDHIG A DUPLICATE PIPELINE TO TAKE WATER ACROSS TOLO CHANNEL.

THE UNDERWATER MAIN IS PART OF STAGE THREE OF THE MULTI-MILLION DOLLAR PROJECT TO TAKE MORE WATER FROM CHINA.

AT PRESENT THE $626 MILLION STAGE TWO OF THE PROJECT: 19:ONDERWIY: AND IS EXPECTED TO BE COMPLETED BY 1991 WHEN STAGE THREE IS SOWEDULET TO BEGIN.

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AS PART OF STAGE TWO A $66 MILLION SUBMARINE PIPELINE 43 DE ING BUILT UNDER.TOLO CHANNEL BETWEEN HARBOUR ISLAND AND SAI APPROPRIATE LAND MAINS ON BOTH SIDES OF THE CHANNEL.

FORECASTS SHOW THAT A DUPLICATE PIPELINE UNDER THE CRANNEL WILL BE NEEDED IN 1993 AND WORK ON THIS WAS TO HAVE STARTED IN 1963

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HOWEVER, THE CONTRACTORS FOR THE FIRST TOLO PIPELINE PROJEST HAVE OFFERED TO LAY THE DUPLICATE PIPE, ALONG WITH THE FIRST REDUCED PRICE OF $41.85 MILLION.

BUT THE OFFER IS VALID ONLY UP TO JUNE 19 AS AFTER THAT DATE THE PRICE OF PIPES FROM JAPAN IS EXPECTED TO RISE.

BY BUILDING THE SECOND PIPELINE AT THE SAME TIME AS THE 'FIRST, THE GOVERNMENT WILL SAVE ON CAPITAL COSTS, REDUCE SUPERVISION® COSTS AS SUPERVISORY STAFF ARE ALREADY ON SITE, AND REDUCE PUMPING COSTA: BETWEEN 1988 AND 1993 AS PUMPING WATER THROUGH TWIN PIPES WILL SEAFA MORE EFFICIENT THAS PUMPING THROUGH A SINGLE PIPE.

THE ESTIMATED SAVING OF $5.71 MILLION IS A CONSERVATIVE ONE AND DOES NOT TAKE INTO ACCOUNT POSSIBLE SAVINGS ON LAND COSTS, UNILATION ENVIRONMENTAL AND ADMINISTRATIVE COSTS.

ESTIMATES SHOW THAT, ALREADY, THERE HAVE BEEK- ENOUGH BAY. ON STAGE TWO PROJECTS TO ALLOW THE ADDITIONAL PIPE TO BE LAID WITH INCREASING THE ORIGINAL $626 MILLION STAGE TWO BUDGET,

LAST FINANCIAL YEAR $210 MILLION WAS SPENT ON STAGE TWO IT IS ESTIMATED THAT $270 MILLION WILL BE SPENT THIS YEARM MILLION NEXT FINANCIAL YEAR AND $79 MILLION IN 1988-09.-