Transurban has announced that it has reached an in-principle agreement with the Victorian government to widen the western section of Melbourne's CityLink, the Bolte Bridge-West Gate Freeway interchange and Tullamarine Freeway.

Transurban will pay for an A$850 million upgrade, which involves 33km between the Bolte Bridge and Tullamarine Freeway north of English Street (Melbourne). There will also be extra lanes on the Bolte Bridge. The project, an unsolicited proposal from Transurban, will lift traffic capacity on the roads by 30 per cent.

In return, Transurban will benefit from tolls on the increased traffic, its CityLink concession will be extended by one year taking its operation of the road to 2035, and truck tolls will be increased to come in line with the higher truck tolls in NSW and Queensland.

Furthermore, the period in which the CityLink toll price will increase at the greater of 4.5 per cent or the inflation rate, has been extended for a year.

Scott Charlton, Transurban CEO, stated:

The additional lane capacity proposed will improve travel time reliability for the currently 150,000 vehicles, including 14,000 freight vehicles, that use Western Link every day. The approximately $850 million project will deliver significant improvements to the movement of goods and services on Melbourne's orbital network. It will also provide an economic boost to Victoria, supporting jobs in construction and related industries.

In addition to this $850 million project, the Government is in discussions with the Commonwealth to complete the widening of the Tullamarine Freeway to the Melbourne Airport. This further expansion would add an extra lane in each direction from Melrose Drive to Melbourne Airport at a cost of approximately $250 million.