The high-speed rail project connecting Don Mueang, Suvarnabhumi, and U-Tapao airports is slated to commence operations later this year, following a revised agreement between the government and the project developers.

Anan Phonimdang, Deputy Governor of the State Railway of Thailand (SRT), confirmed that the revised agreement has been approved by the SRT board.

The agreement will be forwarded to the Eastern Economic Corridor (EEC) Policy Committee and the cabinet for further review to ensure the state’s interests are protected. The Notice to Proceed (NTP) is expected to be issued by the end of this year.

Asia Era One, a consortium led by CP Group, won the 224.5 billion baht contract to build the rail system in 2018. However, the project faced delays due to various issues, including the pandemic’s impact.

The SRT and the Office of the EEC have renegotiated parts of the contract with the consortium to ensure project completion.

“The resolution is clear and based on established principles. The company must provide an additional bank guarantee to assure project completion,” said Mr. Anan.

The revised contract addresses four key issues: payment of the joint venture rights, government investment in the project, an additional bank guarantee, and investment promotion privileges.

Under the new terms, Asia Era One will pay the joint venture rights in full, plus interest, totaling 11.7 billion baht, in seven installments.

The government will begin investing in the project 18 months after the NTP is issued, rather than immediately after the trains start operating. The company is required to provide an additional bank guarantee of 111.9 billion baht within 270 days of the contract revision.

Under the original public-private partnership agreement, the government committed to investing 111.9 billion baht in the project, including 3.57 billion baht for land appropriation. The remaining 108.33 billion baht would be paid starting in the sixth year after train operations commence.

Asia Era One has requested the government to compensate for ongoing construction work.

For the NTP to be issued, the company must first receive an investment promotion certificate from the Board of Investment. However, this requirement has been waived following the review process that concluded on May 22, said Mr. Anan.

If the NTP is issued as planned, the construction is expected to be completed by 2029.

Source: Bangkok Post

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