Wales launches MIM road

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Wales launches MIM road

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The Welsh government has issued a prior information notice (PIN) for the upgrade of the Sections 5 and 6 of the A465 through its new Mutual Investment Model (MIM).

The A465, or Heads of the Valleys road, is one of the key corridors and international gateways for the south Wales economy. It connects the M4 at Neath to Abergavenny and Hereford. It provides links between west Wales and the Midlands, and also links up the northern valleys, supporting regeneration in the communities.

The project involves the design, construction, operation, maintenance and finance of the predominantly on line 17.7km improvement of the A465 trunk road between Dowlais and Hirwaun from 3 lane single carriageway to dual 2 lane carriageway. The scheme includes approximately 2.2km off-line new road construction from Hirwaun to Trewaun; six full movement grade-separated junctions located at Hirwaun, Croesbychan, Baverstock, A470, Prince Charles Hospital, and Dowlais and 111 structures comprising retaining walls, culverts and 35 widened or constructed bridges including 4 large viaducts. The total investment is estimated at £400 million (US$527 million).

The Transport Division of the Department for Economy and Infrastructure intends to conduct a market engagement exercise in October 2017 to inform the scoping, approach to and content of the procurement. The project is expected to be awarded in April 2018 and will be completed in 2020. The prior information notice is available here.

It has already completed section 1 between Abergavenny and Gilwern, section 3 between Brynmawr and Tredegar, and section 4 between Tredegar and Dowlais Top.

The Mutual Investment Model (MIM) is an innovative approach to investment in public infrastructure developed in Wales. The MIM will support additional investment in social and economic infrastructure projects, which might not otherwise have been built due to a scarcity of capital funding.

MIM schemes will see private partners build and maintain public assets. In return, the Welsh government will pay a fee to the private partner, which will cover the cost of construction, maintenance and financing the project. At the end of a specified period of time the asset will be transferred into public ownership.

In February 2017,  the Cabinet Secretary for Finance and Local Government, Mark Drakeford, announced the government’s intention to undertake 3 schemes using the MIM, including the the dualling of the A465. The other two projectas are the Velindre Cancer Centre in Cardiff and the additional investment in Band B of the 21st Century Schools Programme.

As we reported in January 2016, Jacobs Engineering Group was awarded a contract to provide technical advisory services for the upgrade. Other advisors are DLA Piper (legal), PWC (financial), Willis (insurance).

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