TNAG-1175-FCO40-1477-Proposed-replacement-airport-for-Hong-Kong-at-Deep-Bay-or-Ch-1982 — Page 120

Task 5.

Analysis of capital construction costs

5.1

5.2

5.3

This function will be undertaken in consultation with

Government, Master Plan consultant and Civil Engineering Design

consultant. Capital outlays will be incurred from the start of

construction and continue after the initial stages of the

Airport are in operation. The phasing of the construction

programme will be reviewed to arrive at a preliminary schedule

of cost payments over the construction period.

The schedule thus achieved will be subject to a number of

variable factors escalation in equipment costs,

slippages, delays in construction, equipment supply and

inflation, all of which affect cash flow forecasts.

Assumptions in respect of such factors will be formed, in

consultation with Government, Master Plan consultant and Civil

Engineering Design consultant, after undertaking an initial

breakdown of the overall project cost into major constituents

such as reclamation and civil works, equipment supplies, labour

and services. The impact of these factors on individual

elements and on the project as a whole will be ascertained and

this information will form part of the sensitivity analysis.

The capital cost will be analysed to coincide with the

consideration of financing sources. The phasing of the

Airport construction from the detailed design/engineering

stage, through land acquisition and reclamation, civil

works, construction and commissioning of the first runway,

procurement and installation of equipment and finally to

the construction and commissioning of the second runway

will be examined for financing purposes. The major items

of capital expenditure within each stage will be isolated

and a view taken as to a likely construction and

procurement programme.

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