ENG-1992 — Page 288

AIRPORT

Two contracts with a total value of $8.78 billion were awarded for the Lantau Fixed Crossing - one for the Tsing Ma Bridge and the other for the Kap Shui Mun Bridge and Ma Wan Viaduct.

On the North Lantau Expressway, contracts for the Tai Ho and Yam O sections, which make up two thirds of the length, were let for a total of $4.4 billion. Tenders for the Tung Chung section were invited in March 1993.

On the West Kowloon Reclamation, seven contracts costing some $4.3 billion were let for a variety of work. Five more are due to be let in 1993. A site formation contract costing $732 million was also let for the Tung Chung development where construction of public housing and government facilities is scheduled to start in 1994.

Tenders for the first phase of the Central and Wanchai Reclamation engineering works were invited in June 1992. They were returned in September 1992.

On Route 3, prequalification exercises for a tunnel and viaduct were completed and tenders were invited in August and September. Tenders for the bridge were invited in November 1992.

Tenders for the north and south sections of the West Kowloon Expressway were scheduled to be invited in the first quarter of 1993.

The government has stressed that it welcomes international participation in the contracts and that it is strictly applying its traditional level playing field approach on tendering procedures and the award of contracts.

A significant number of international companies have won construction and site investigation contracts, often in joint ventures. They have come from a wide range of countries including Japan, the United Kingdom, the United States, the People's Republic of China, Australia, France, the Netherlands, New Zealand and Italy as well as Hong Kong. Firms winning consultancies have come from the UK, USA, the Netherlands and Japan as well as Hong Kong.

The selection of contractors, whether local or multi-national, is strictly based on the extent to which they can meet the government's requirements in terms of completion on time, within the government's required standards and specifications, and at the lowest possible price.

Management and Cost Controls

An overall strategy has been drawn up to establish the scope of the ACP, the critical programme objectives, and the budget. This is the basis for the overall programme and project management. Fixed price lump sum contracts are being used for most projects to minimise risks to the government, especially from inflation and the estimation of quantities.

A cost control system has been introduced for the ACP, laying down procedures for monitoring, scrutinising, and controlling costs during the design and construction of the government-funded projects. Early warnings of cost increases are reported to the New Airport Projects Co-ordination Office (NAPCO) and department heads. Proposed design changes leading to higher costs have to be fully justified and approved before detailed design is started. This system enables trends, which could lead to cost increases, to be identified early. If cost increases are accepted, offsetting savings are sought in the same or other ACP projects.

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