Higher Costs

April 15, 2009 (LBO) – A Chinese contractor building a part of an expressway to Sri Lanka’s south has more than doubled the original contract value following cost escalations and a decision to widen the road. The cost of building the section of road from Kottawa in the suburbs of Sri Lanka’s capital Colombo to Dodangoda, has increased from 9,585 million rupees to 20,000 million rupees.

Sri Lanka’s cabinet of ministers had approved the enhanced contract to China Harbour Engineering Company (CHEC) with the concurrence of Japan Bank for International Co-operation (JBIC), which is funding that part of the project, in March 2009.

The first half of the 130 kilometre expressway from Colombo to Matara running from Kottawa to Kurundugahahetekma is funded by the JBIC. The second half is funded by the Asian Development Bank.

The new contract related to the first half of the JBIC funded section or ‘package 01’ running from Kottawa to Dodangoda.

The cabinet note from the ministry of highways said the first half had to be widened by an extra 2.5 metres on a government decision to broaden the latter part of the expressway from two lanes to four lanes and extra work undertaken for flood protection.

C