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May 11, 2018

Preliminary preparation stage for concession on Northern Latitudinal Railway completed

A working meeting has been held on the implementation of the Northern Latitudinal Railway project.

Taking part in the meeting were Russia’s acting Minister of Transport Maxim Sokolov, the CEO and Chairman of the Board of Russian Railways Oleg Belozerov, the Governor of the Yamal-Nenets Autonomous District Dmitry Kobylkin, representatives of the future Northern Latitudinal Railway concessionaire, the Public Joint Stock Company (PJSC) Gazprom and other parties to the project.

At the meeting, which was held in Salekhard in north Russia Top of Formon 11 May 2018, the participants finalised the main conditions and parameters of the concession scheme and signed the final protocol.

The participants also noted that all the documents necessary to start the construction of the Northern latitudinal Railway were ready for submission to the Government of the Russian Federation for a decision.

At the moment, the potential concessionaire is currently completing design and survey work in order to begin construction work in 2019.

As part of the concession, more than 350 kilometres of railway track and bridges across the Ob and Nadym rivers will be built.

The construction work is scheduled for completion in 2023.

According to the meeting participants, the project’s implementation fully corresponds to one of the key tasks set by the President of Russia Vladimir Putin in the decree "On National Goals and Strategic Tasks in the Development of the Russian Federation during the Period until 2024" – that of increasing the degree of economic coherence across the country's vast territory.

After the meeting, Maxim Sokolov, Oleg Belozerov and Dmitry Kobylkin took part in a ceremony to lay a memorial capsule in the foundation of the future bridge over the Ob River.

"Today we are not only making a symbolic start to the construction of a bridge across the Ob, but are also opening up a new large-scale stage in the development of Russia’s transport infrastructure. The construction of the Northern Latitudinal Railway will change the picture of transportation across the whole country," concluded Oleg Belozerov during the meeting.

*  *  *

The construction of the Northern Latitudinal Railway is scheduled for 2018-2023. The projected volume of transportation is 23.9 million tons, consisting mainly of gas condensate and oil products.

The Northern Latitudinal Railway will be implemented on the principles of a Public-Private Partnership (PPP) in the form of a concession.

In global practice, PPPs are the most progressive form of implementing such large capital-intensive projects, facilitating the provision of financing and rationally distributing the risks between the participants.

In the framework of its investment programme, Russian Railways will carry out the reconstruction of the adjacent sections of the Konosh - Kotlas - Chum - Labytnangi stretch on the Northern Railway, including Ob station, and the Pangody - Novy Urengoy - Korotchaevo railway line, which is part of Sverdlovsk Railways.

PJSC Gazprom will complete the construction and commissioning of its own 104 km Nadym - Pangody railway line

Under the concession agreement, a special project company called SPK-Concessionaire will provide the financing, construction and operation of the Obskaya-Salekhard-Nadym line. A railway section of the bridges across the rivers Ob and Nadym and the approaches to them will be built, as well as a new 353 km Salekhard-Nadym railway section.

The administration of the Yamalo-Nenets Autonomous District will be an investor in the construction of the automobile section of the bridge across the Ob and will provide the necessary project documentation.

Yamalo-Nenets will also provide federal property with the plots of land needed for the construction of the road, and will ensure that construction workers have access to water bodies and forest areas. The Autonomous District will also make available benefits on the property tax.

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