Re: Top End rail loan collapses

[mauried@tpg.com.au (Maurie Daly)]

On Wed, 28 Mar 2001 11:18:29 +1000, David Bromage
<dbromage@fang.omni.com.au> wrote:

>The long-awaited $1.3 billion Alice Springs to Darwin railway was
>threatened with collapse yesterday after the consortium behind the
>project rejected a $26.5 million loan from one of Asia's richest
>businessmen. The dramatic rejection of the last piece of the funding
>jigsaw forced South Australia's besieged Government to inject another
>$26.5 million into the project, leaving the financially strapped state
>with a $176.5 million exposure.
>
>http://www.theaustralian.com.au/common/story_page/0,4511,1841757%255E601,00.html
>
>SA Premier John Olsen responded by announcing public bonds would be
>issued to raise the funds, a move that must first be approved by
>Parliament.
>
>http://www.theadvertiser.com.au/common/story_page/0,4511,1840973%255E910,00.html


Well,railfans , its now time to put your money where your mouths are .
The SA Govt is going to offer bonds at 8% interest to raise funds to
get the AP-Darwin line up and running again.
Im sure that we could raise around $26.5 million from the readers of
this news group.

The combined Govt injection of capital into this project is now $560
million which is 50% of the total project cost.
Just what happens if there are now cost blowouts ,as there usually are
on projects of this size.
Who will pay for the overruns??
We can guess, but if the total Govt injection of funds into the
projecr exceeds 50% , then the consortium by rights should become a
minority owner ,and only etitled to minority control.

MD