How world-class infrastructure will connect regional Australia with domestic and international markets

Transcription

1 How world-class infrastructure will connect regional Australia with domestic and international markets Richard Wankmuller Australian Rail Track Corporation Inland Rail Chief Executive Officer Transcript of presentation to Australian Financial Review National Infrastructure Summit Delivered: Tuesday 5 June 2018 Sofitel Wentworth Plaza, Sydney I m going to talk about Inland Rail today. It connects Australia right across the country. (Refers slide) You can see from the dark blueline line from Melbourne to Brisbane is the Inland Rail project, as you see it does start to connect our capital cities that have never been connected before. It does that in a lot of different ways and there are a lot of different reasons for this being important, which I will get to here in a minute. When we put this all together, one of the first things that we have done is to try to figure out what does industry want. The messages were very clear. The messages were it has to be price competitive and as an alternative to trucks at all times. It has to have the reliability you can count on to get services and goods to market in time. The most important point, which I will talk about a number of times: You have to have a transit time from Melbourne to Brisbane that is less than 24 hours without that you are not going to meet business needs. Now, it does so with features that are unmatched in Australia today. It has 1.8-kilometrelong trains, with double stacked capability, which will provide speeds that are more in line with global standards. I think that the speeds that freight moves across this country at present are below standard. What we will put in place will be an inter-operability connecting regional lines and giving flexibility to various areas. Those features wind up with some great outcomes. I will try to simplify it. First, as I mentioned, it connects Australia. The second is that it is fast. It is very, very important that this line is straight, flat and fast. 1

2 What we are trying to do is take the transit time down from 33 hours today to 24 hours or less. So, every decision that is being made as part of our team is to optimise travel time. But at the same time, it has to be reliable and cost effective and we believe that we will get a 30% reduction in comparative transport costs. It is very, very important that it is competitive. But it has wider economic benefits across Australia. The business case details that it will create 16,000 jobs, but it also points out additional economic benefits of $16 billion - beyond the $10 billion construction costs. And it is these wider economic benefits that are vitally important, because in the end this is a program about providing wider economic benefits for Australia. The freight challenge across Australia is growing significantly. The major corridors between Brisbane to Melbourne; Melbourne to Adelaide; Adelaide to Perth; that demand is going to grow from 6.7 metric tonnes to 17.9 metric tonnes a factor of three. It helps meet that demand but more importantly today, unlike other parts of the world, rail is a very low percentage. Australia is heavily dependent on trucks on the road large trucks on the road. As the freight capacity, freight need grows, there is going to be a lot more traffic. Building Inland Rail will make a tremendous change in what would be the amount of trucks on the road to what will be the amount of trucks on the road. We can eliminate over 200,000 trucks. So how connected? That is what I was asked to talk about. I am going to talk more about what is important to building this type of infrastructure, rather than the infrastructure itself. This is a unique challenge. This is going to be built across 1,700 km it s not one large site. We are not spending $10 billion in one area. It s about spending $10 billion across 1,700 km, through urban areas, through regional Australia with many interest groups and stakeholders. Now we re doing so with great support from the government, providing more than $9 billion in equity. We going to do in partnership with the private sector. We re off to a good start. As of today, there s $250 million worth of contracts in place with some of the largest engineering service providers in the country and that will continue to grow. But what I would like everyone to know is that we are doing so not only hand-in-hand with the community, but in partnership with the private sector. We re talking with the private sector, we re listening how we de-risk the program, how we get the best contracts with Australian providers with all the competition that is out there. We think that we can only do that by talking with them and understanding what works for them going forward. A couple of things that I would like to point out about the private sector. It s obvious that there is going to be some direct investment through PPP. What s not so obvious is the indirectness. I ve only been in the job now 30 days so the first 15 days have been spent in regional Australia talking with people, communities, businesses, councillors and mayors - identifying ways that they can benefit through their own investment things like standing quarries, 2

3 building new quarries, providing water supplies a lot of water is going to be needed - looking at pre-cast concrete options. This piece is very important as it speaks to those wider economic benefits, not only for this project, but for the massive wave of infrastructure that is coming. These people can benefit from this. Now the PPP route we selected this route on purpose. This is from Gowrie to Kagaru. Why this section for PPP? Because it offers the most chance of innovation. It s a complicated section with many pieces. The amount of earthworks that have to be moved, the bridges that have to be built, the grade separations, the tunnels this is a complicated piece of work and we are hoping to attract some good ideas from the private sector and benefit from innovation. We are certainly going to work with them to make sure that they get the right specifications that will allow them to be innovative. We are now looking at private sector to working hand-in-hand with the community. Our commitment is to do real community engagement and that means that not only do you engage, but you listen and more importantly you hear. When you show up and talk to people you have to understand what their problems are. You have empathy for it and come up with mitigation procedures to help them. Most importantly, going forward, as we spend this money and go through the EIS process is that we respond quickly, because the reality is that not everyone is going to be happy and they have a right to know, so we have to give them that information as quickly as possible so that they can make their own decisions. Now this has been going on for some time it goes back to 2010 and well beyond that. There have been a lot of studies done, there have been a lot of people involved, obviously some smart people put the case study together, the original study headed up by the Hon. John Anderson, and the business case was led by Price Waterhouse Coopers. It was supported by one of the better engineering companies in the world Parsons Brinkerhoff. We accepted it and it was reviewed by Infrastructure Australia, which listed the project as a national priority - not just a good project to do, but as a National Priority Project. There has been a lot work done. There is a lot of work to do. We have made some progress so far, but there is a little way to go. There has been some good work done with 1,500 manual contacts so far. We need broad community consultation and we have done a lot of one-on-one, face-to-face individual consultations. We re in a complicated environment because we know that each of the states in Australia has a different way of approaching things. The EIS process is no different. We have to cover off different requirements in different states, but the EIS process goals are the same across the states. That is, to engage with people, and look for ways to mitigate the impacts to both the community and the environment. That is the stage that we are at now and will be for the next 18 months or so, so there will be a lot more communication. But at Inland Rail, we re going beyond the statutory requirements. We re implementing best practices. This best practice includes Community Consultative Committees, which will be around for the whole project life cycle. 3

4 Statutorily we could have just engaged through the EIS, but we re putting this in place through to final design, into construction, into operations, so we get ongoing input from the community to make their lives a little easier in sometimes difficult circumstances. That involves understanding what construction impacts might have to the role of business and to look for ways to mitigate that. It includes ways to help them through the harvesting season in Australia. I just want to highlight some of the bigger things that we have done so far because there has been a lot done. One of the unique things about this program was there was no real clarity about whether this project would go ahead for sure until the Government provided initial funding of $8.4 billion and that was only about a year ago. So, there was a lot of pre-work done by ARTC, as the implementing arm it only had the guernsey for about a year, but it evolved before that for about a year. In that time, they have made sure that there is a continuous study area, now between Brisbane and Melbourne, that has evolved over time with community input. It used to be 2km wide 1km on each side. In that corridor there were areas that required further study to mitigate the impact to communities. Now that corridor area varies in size. In some areas some of the mitigation still needs to occur and this is why it s about 5km. So, we can now determine the final route over that 5km. There are 13 Inland Rail projects. Some will be delivered as design and construct, some will be delivered as construct only, some will be delivered through PPP they are tailored to the situation at hand and that section. There will be greenfield sites that will be design and construct and there will be live, operating parts of that rail that will need a little more control and help from the contactor in specifying exactly what we want and when we want to do it. We also have in place 741 Land Access Agreements. Those that we try to sell and sign, 97% of the time they have signed the agreement. There are those that don t want to agree, but so far, the track record has been very good. We re progressing the PPP. You ll see an expression of interest out in the industry here in the last quarter of this year. We have already engaged with a number of known providers. As I mentioned earlier, we have more than 250 contracts in place and steel and concrete are already arriving. Now in the past couple of weeks we have seen interest from the enterprise and the businesses. In the last two weeks in just three capital cities Sydney, Melbourne and Brisbane we have had more than 1,200 people show up to our industry briefs to hear about the program. So, this is truly on its way. We are seeing over the next year or two this continued commitment to engagement with the community. We have 1,500 more people to see and we ll have a lot more conversations. We re ready to commence large-scale construction. We have already completed some small-scale multi-million enhancements along the line, but we ll soon be spending hundreds of millions of dollars. And we ll get the PPP going. 4

5 We ll get more construction going. And why are we going to get more construction going? The reason is this is about building credibility with the public. They have to believe that this going to be built. They have to believe that this going to be built well. The more they see progress, the more they can see that people are listening, the more they can see something coming out of this that is going to benefit them, the more people are going to take up the offer of Inland Rail. So it s a very comprehensive program and I m proud to be part of it. I m still learning, and I ve enjoyed it so far. I think it is a project that we are going to look back on and be very grateful that this was built as it will make a difference. Thank you. //ENDS \\ Media contact: Laura Brice (02) /