Tender process for 330 km Ankara-Niğde Highway Project has been launched by the General Directorate of Highways upon publication of the tender announcement in the Official Gazette on December 30, 2016.
Project Model and Contractual Structure
The project model will be build-operate-transfer. The concession agreement will be the Implementation Contract (“IC”) to be signed between the General Directorate of Highways (“KGM”) and the project company to be established by the successful bidder. In addition to the IC, a separate agreement, namely Implementation Contract Direct Agreement, will be signed between KGM, the project company and the lenders to regulate the rights of lenders vis-à-vis KGM, such as step-in, substitution, KGM’s representations and undertakings, and the mechanisms for lenders to trigger termination of the IC.
Debt Assumption by Treasury
As per Law No. 4749 on Public Financing and Debt Management, debt assumption is to be made by the Treasury for projects with a total investment amount of more than TL 1 billion. As the total investment amount of this project is higher than this threshold, the Treasury is expected to be the counterparty to the debt assumption agreement to be signed with the lenders and the project company.
The project will benefit from a traffic guarantee to be provided by KGM as well as guaranteed minimum tolls for different types of vehicles. Details of the traffic guarantee and minimum tolls will be stated in the tender documentation, which has not yet been made available to the public. Potential bidders will be entitled to review the tender documentation by visiting KGM’s offices in Ankara starting from January 16, 2017.
The deadline for submission of the bids is 10:00 a.m. on April 14, 2017, and the tender will be conducted at 10:30 a.m. on the same day. In the first phase the bidders which fulfill the required qualifications will be selected. In the second phase, the prequalified bidders are expected to compete based on the proposed duration of the operation term. Other details of the project, such as the construction term, land expropriation and site visit date, will be provided in the tender documentation, which will be made available to the public starting from January 16, 2017 at KGM’s offices as stated above.
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