Contents Pre‐Feasibility Studies of Selected Asian Highway Sections
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Contents Pre‐Feasibility Studies of Selected Asian Highway Sections
UNESCAP ASIAN HIGHWAY INVESTMENT FORUM Pre‐Feasibility Studies of Selected Asian Highway Sections Bangkok, October 8, 2013 Woo-Hyun KWON UNESCAP Consultant PPP Advisor to DPWH, Philippines Sr. Manager, KEC, Korea Contents 1. Description of the Study 2. Bangladesh: Jessore-Banpara (AH41) 3. Kyrgyzstan: Bishkek-Chaldova (AH5) 4. Mongolia: Khovd-Uliastai (AH32) 5. Myanmar: Takaw-Kyaintong (AH2) 6. Recommendation Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 1. Description of the study Outlook of Asian Highway (AH) Network Limitation of the study Methodology(Technical & Economic Analysis) 1. Description of the Study Outlook of Asian Highway Network (32Countries, 141,000km) 1. Description of the Study UNESCAP Efforts on identifying investment needs 9 2006: Priority investment needs for Asian Highway (AH) 9 2007: Pre-Feasibility study of the selected AH routes 9 Nov 2007: Investment Forum 9 Nov 2010: Promotion of investment in the selected AH routes (Trust Fund by Korea Expressway Corp.) 9 2013: Pre-FS of the selected AH in 4 countries 9 Oct 2013: Investment Forum 1. Description of the Study Limitation of the study (Recommendations for a formal FS) Routes selection by recipient countries in light of their national priorities and strategic contexts (Upfront rationale review may be of help) Limited resources in budget, time and inputs 9 Brief field ‘trips’ (1~3 day), ‘secondary’ data usage 9 Safeguarding review (social & environmental) 9 Benefits of improved cross-border connectivity including lifting obstacles/barriers shall be further explored ¾ Initial evaluation of candidate routes, mainly with low demand, to facilitate the interventions from donors/investors 1. Description of the Study Methodology 1. Description of the Study Economic Analysis 1. Description of the Study Basic Assumptions (Economic Analysis) 9 Construction: 2 years (Bangladesh, Kyrgyzstan, 2013-14) 3 years (Mongolia, Myanmar, 2013-15) 9 Analysis period : 2015(16) ~ 2044(45) year * 30 years after opening 9 Discount rate : 12.0% (proposed value of ADB) 9 Basic Price: Market price in 2011 (Economic price converted from market price) Evaluation Criteria 9 Internal Rate of Return (IRR) > Social Discount Rate 9 Benefit - Cost Ratio (B/C) > 1 9 Net Present Value (NPV) > 0 Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 2. Bangladesh: Jessore-Banpara (AH41) Project Summary Strategic Context Socio-economic characteristics Technical Feasibility Traffic Forecast Economic Analysis Conclusion and Recommendation 2. Bangladesh: Jessore-Banpara (AH41) Project summary Upgrading Jessore-Banpara (148km, 2 lane, AH class 2) 9 Jessore-Jhenaidah (103KM) 9 Jhenaidah-Jessore (45km) (Rehabilitation by ADB) Capacity Building (Apr 26, 2013) 9Preparation of proposal (Traffic projection, Economic analysis, Safeguarding, PPP) 2. Bangladesh: Jessore-Banpara (AH41) Strategic context A part of 6th five-year Plan (2010/2011 to 2014/2015) Principal N to S corridor in the western region 9 connecting Mongla sea port and Benapole dry port 9 to and from India and land-locked Nepal and Bhutan Banpara Jhenaidah Dhaka Benapole Mongla 2. Bangladesh: Jessore-Banpara (AH41) Socio-economic characteristics (2011) Population: 150.5 million (Annual population growth: 1.32%) GDP per capita: US $735 (GDP Growth Rate: 6.7%) No. of registered vehicles: 0.5 million (Growth rate 6.3%) 9 including Rickshaw and MC: 1.5 million (Growth rate 9.2%) Road system inventory (RHD) Road Type Total Length(km) Road Administrator National Highway 3,492 RHD Regional Highway 4,268 RHD Zilla Road 13,280 RHD Sub-Total 21,040 2. Bangladesh: Jessore-Banpara (AH41) Technical Feasibility Field trip: Aug 26-27, 2013 (Dhaka-Banpara-Jessore) Findings and Recommendations 9 Alignment: AH Class2, Most sections run through flat terrain ¾ City bypass (Kushita) is recommended 9 Pavement: 2 lane DBST and AC with overall fair condition ¾ Partial repair based on the current alignment 9 9 9 • • • Bridges: 12 bridges with relatively good conditions Social & environmental impact: Kushita bypass only Road safety: Integration of 2 close roundabouts (N6 and N705 IC) Relocation of Bus stops in the IC Separation of NMT by frontage road and safety furniture 2. Bangladesh: Jessore-Banpara (AH41) Division of sections 9 Section 1 (Jessore-Jhenaidah, 45km): Rehabilitation by ADB 9 Section 2 (Jhenaidah-Paksey, 73km): Kulna Div. 9 Section 3 (Paksey- Banpara, 32km): Rajshahi Div. 2. Bangladesh: Jessore-Banpara (AH41) Section 2 (Jhenaidah-Paksey, 73km) 2. Bangladesh: Jessore-Banpara (AH41) Section 2 (Jhenaidah-Paksey, 73km) 2. Bangladesh: Jessore-Banpara (AH41) Section 3 (Paksey-Banpara, 32km) 2. Bangladesh: Jessore-Banpara (AH41) Section 3 (Paksey-Banpara, 32km) 2. Bangladesh: Jessore-Banpara (AH41) Traffic forecast Current Traffic condition: 4,900~5,900 veh/day (2013) Traffic Projection: max 13,500veh/day (2044) 9 Jhenaidah-Dasuria: 6,400 (2015)-13,500 (2044) 9 Dasuria-Banpara: 5,500 (2015)-11,500 (2044) Improvement Plan 9 Alt 1(101km): AC overlay(86km) with 2 lane bypass (15km) 9 Alt 2(105km): AC overlay for the whole section (105km) 9 Alt 3(101km): Reconstruction(86km) with 2lane bypass(15km) 2. Bangladesh: Jessore-Banpara (AH41) Cost estimates Unit cost estimation (RHD) Preliminary cost estimation Quantities Unit cost (US $) a. Construction of the new road 15km 913,593 13,704 b. Overlay of the existing road 86km 139,925 12,034 Alternative Alternative-1 Contents Total 101km Cost (US $ in thousands) 25,738 Alternative-2 a. Overlay of the existing road 105km 139,925 14,692 Alternative-3 a. Reconstruction of entire section 105km 913,593 95,927 2. Bangladesh: Jessore-Banpara (AH41) Economic Analysis Cost Estimation: Construction, Maintenance (periodic+ routine) Benefits: VOC(Korean Model), TTS(RHD) Result of Economic Analysis Content B/C NPV (USD 1,000) IRR Alternative 1 1.408 9,086.8 16.78% Alternative 2 2.761 19,521.8 28.22% 2. Bangladesh: Jessore-Banpara (AH41) Conclusion 1. Jhenaidah-Banpara section (AH41) shall be the principal N to S corridor in the western region in Bangladesh connecting both nation’s 2nd largest Mongla sea port and Benapole dry port. 2. The improvement of surface, from DBST to AC overlay with Kushita bypass, was proposed with total cost of USD 25.7m. 9 AC overlay (86km, USD 13.7million) 9 Construction of Kushita bypass (15 km, USD 12.0million) 3. Traffic projection in 2045 is max 13,442 veh/day. 4. Alt 1 and 2 are economically feasible. 2. Bangladesh: Jessore-Banpara (AH41) Recommendation 1. AC overlay with 2 lane bypass (Alt 2) is found to be the default option as a whole. 2. Reconstruction (Alt 3) is found to be economically infeasible; however, a holistic, instead of demand-driven, approach shall be in place by thorough survey considering: 9 relatively small cost (USD 95m) 9 enhancing mobility and cross-border connectivity 9 economic and social development in the western region of Bangladesh and neighboring land-locked Nepal and Bhutan Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Project Summary Strategic Context Socio-economic characteristics Technical Feasibility Traffic Forecast Economic Analysis Conclusion and Recommendation 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Project summary Upgrading Bishkek-Chaldova(92km, 2 lane, AH class 1 & 2) 9 Bishkek-Karabalta (60km, Rehabilitation by ADB) Capacity Building (Apr 26, 2013) 9Preparation of proposal(Traffic/Economic analysis, Safeguard) 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Strategic context 1.Bishkek-Kara Balta-Chaldovar section (92km): This east-west corridor is in the GOK’s top priority as well as N-S BishkekTorougart (AH61) and Kara Balta-Osh corridors. 2. It is AH Class I and II. 2. Construction of new Bishkek-Kara Balta highway (4 lanes) by PPP: The capacity of Bishkek-Kara Balta corridor could be enhanced significantly with new highway. 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Socio-economic characteristics (2010) Population: 5.5 million (Annual population growth: 0.65%) GDP per capita: US $880 (GDP Growth Rate: -1.4%) No. of registered vehicles: 0.31 million (Growth rate 4.1%) Road system inventory (MOTC) By Class Length (km) % International National Local Total 4,163 5,678 8,969 18,810 22 30 48 100 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Technical Feasibility Field Survey: June 7, 2013 Findings and Recommendations 9 Alignment: Level terrain, straight 9 Pavement: 2, 4-6 lane AC with overall good condition 9Geology: On the huge alluvial fan from the mountainous region of Tien Shan, which may cause uneven settlement 9Social & environmental impact: Several medium-sized cities are dispersed, and also many resident buildings and various markets are located alongside of the road Division of sections 9 Section 1 (Bishkek-Kara Balta, 60km): Rehabilitation by ADB 9 Section 2 (Kara Balta-Chaldovar, 32km) 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Section 1 (Bishkek-Kara Balta, 60km) 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Section 1 (Bishkek-Kara Balta, 60km) 9 Rehabilitation: ADB’S CAREC Corridor 3 (Bishkek-Osh Road) Improvement Project, Phase 4 9 New PPP Road (4 lane, Preliminary design in 1988) • It will run parallel to the project road, approx. 5km northward • Financial viability may be slim in the near term Toll rate for PPP road (Som) PPP road travel time (%) in compare to existing road Traffic Volume (2044, vehicle/day) PPP road Existing Road free 75.0% 16,174 6,607 10 84.2% 13,441 9,340 20 93.2% 11,163 11,618 30 102.3% 8,429 14,352 40 113.0% 5,695 17,086 50 120.5% 3,417 19,364 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Section 2 (Kara Balta-Chaldovar, 32km) 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Section 2 (Kara Balta-Chaldovar, 32km) 9 Built in 1955 (the latest rehabilitation in 1985) 9 The overall surface condition is fair 9 Many potholes/scaling/aggregate separations were identified 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Traffic forecast Current Traffic condition: 2,650~7,200 veh/day (2010) Traffic Projection: max 23,200veh/day (2044) 9 Bishkek-Kara Balta: 9,600 (2015)-23,200 (2044) 9 Kara Balta-Chaldovar: 3,520 (2015)-8,540 (2044) Improvement Plan 9 Alt 1: New PPP road in Bishkek~Kara Balta (MOTC proposal) 9 Alt 2: Widening of Kara Balta~Chaldovar from 2 to 4 lanes 9Alt 3: Overlay with partial repairs and improvement for Kara Balta~ Chaldovar section 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Cost estimates Unit cost estimation (Bishkek-Osh Project) Preliminary cost estimation (Alt 3) Work Name Unit Quantities Unit cost (US $) Cost (US $ in thousand) A. Base Cost 1. Civil Works a. Pavement km 32 168,000 5,376.0 b. Improvement of road1 km 0.96 457,500 439.2 c. Replacement of bearing EA 20 6,100 122.0 d. Installation of wing wall at Pipe EA 2 1,050 2. Consulting Services 2.1 36.5 Subtotal (A) 5,975.8 B. Contingencies 1. Physical Contingency 597.6 2. Price Contingency 280.9 Subtotal (B) 878.5 Total 6,854.3 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Economic Analysis Cost Estimation: Construction, Maintenance (periodic+ routine) Benefits: VOC(Korean Model), TTS(RHD) Result of Economic Analysis (Alt 3) 9 Alternative 1 (with railway crossing improvement) 9 Alternative 2 (without railway crossing improvement) Content B/C NPV (USD 1,000) IRR Alternative 1 Alternative 2 0.746 -2,465.3 6.61% 0.753 -2,302.8 6.59% 3. Kyrgyzstan: Bishkek-Chaldovar (AH5) Conclusion and Recommendation Considering relatively low demand (8,600-2,3200veh/day) until year 2044 in Bishkek~ Chaldovar, capacity enhancement could be done as follows: 1. AC overlay with partial repairs (Kara Balta-Chaldovar) is found to be the default option as a whole. 2. However, widening(2->4) of Kara Balta~Chaldovar can be considered to ensure the consistency of the corridor. 3. Secondly, prepare new PPP road in Bishkek~Kara Balta as demand in Bishkek~Kara Balta~Osh corridor grows in the future. Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 4. Mongolia: Khovd-Uliastai (AH32) Project Summary Strategic Context Socio-economic characteristics Technical Feasibility Traffic Forecast Economic Analysis Conclusion and Recommendation 4. Mongolia: Khovd-Uliastai (AH32) Project summary Upgrading Khovd-Uliastai (473km, Gravel road, AH class III) Capacity Building (May 8, 2013) 9Preparation of proposal(Traffic/Economic analysis, Safeguard) 4. Mongolia: Khovd-Uliastai (AH32) Strategic context 1. Formulation of the principal E to W corridor in Mongolia by connecting Khovd~Uliastai (473km), a part of AH32. 2. It connects: Khovd, the capital of Khovd Province, the far western region of Mongolia with 17 ethnicities; and Uliastai, the capital of Zavkhan Aimag 3. Provision of improved connectivity and mobility in western region will facilitate economic and social development in the regional as well as national level. 4. Mongolia: Khovd-Uliastai (AH32) Socio-economic characteristics (2010) Population: 2.75 million (Annual population growth: 1.35%) GDP per capita: US $1,870 (GDP Growth Rate 6.9%) No. of registered vehicles: 0.61 million (Growth rate 19.3%) Road system inventory (MRTCUD) Paved Unpaved Administrative Level Con’c AC Gravel Improved Earth Total Earth State 56.6 2,007.3 1,508.4 1,312.3 6,282.6 11,136.2 Local 55.0 276.0 498.0 499.0 36,637.0 38,031.0 Total 111.6 2,283.3 2,006.4 1,811.3 42,919.6 49,186.2 4. Mongolia: Khovd-Uliastai (AH32) Technical Feasibility Field Survey: May 9-11, 2013 (Ulanbaataar-Khovd-Uliastai) Findings and Recommendations 9Alignment: •Mostly flat and rolling terrain in dry steppe and Gobi desert (availability of underground water shall be investigated) • AC surfacing is needed except Khovd and Uliastai section •To avoid freezing and thawing, a proper height of embankment and drainage system shall be in place. 9 Pavement: Earth/gravel road except Khovd and Uliastai 9 Bridges: 7 bridges with good conditions 9Social & environmental impact: Khar Us National Park Division of sections: 8 homogeneous sections 4. Mongolia: Khovd-Uliastai (AH32) Section 1-3 (Khovd-Sar Khairhan, 174km) 4. Mongolia: Khovd-Uliastai (AH32) Section 4-5 (Gobi dessert, 134km) 4. Mongolia: Khovd-Uliastai (AH32) Section 6-8 (Zavhanmandal-Uliastai, 165km) 4. Mongolia: Khovd-Uliastai (AH32) Traffic forecast Current Traffic condition: 100~500 veh/day (2011) Traffic Projection: max 10,000veh/day (2045) Improvement Plan 9 Sec 1 (39km, Khovd~Myangad): Improvement of AC pavement 9 Sec 2~7 (408km): Construction of 2 lane AC pavement 9 Sec 8 (26km, Aldarkhaan~Uliastai): AC surfacing is underway From Myangad to Sar Khairhan Bridge (Section 2 and 3, 135km), a northern bypass of Khar Us Lake National Park and Har Lake was proposed. 4. Mongolia: Khovd-Uliastai (AH32) Cost estimates Unit cost estimation (Road Masterplan and FS, WB, 2007) Preliminary cost estimation: USD 154~164 million Economic Analysis Cost Estimation: Construction, Maintenance (periodic+ routine) Benefits: VOC, TTS (Korean Model) Result of Economic Analysis 9 B/C=0.253, NPV=-8.7 million, IRR=1.84% Previous Study (WB, 2007): IRR = 15.4% 9 Potential benefits to the regional agriculture GDP (82% of total benefits) 4. Mongolia: Khovd-Uliastai (AH32) Recommendation 1. 2-lane AC pavement is found to be economically infeasible; however, a holistic, instead of demand-driven, approach may be appropriate for the countries like Mongolia, which represents very low initial values of major indicators for traffic projection including registered vehicles and population. 2. In this regards, improved connectivity and mobility shall be provided in the near term with sustainable financing solutions, which will be vital for economic and social development in the western region as well as whole nation. Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 5. Myanmar: Takaw-Kyaintong (AH2) Project Summary Strategic Context Socio-economic characteristics Technical Feasibility Traffic Forecast Economic Analysis Conclusion and Recommendation 5. Myanmar: Takaw-Kyaintong (AH2) Project summary Upgrading Takaw-Kyaintong (183km, 2 lane, AH class III) 9 Taunggyi-Takaw, MeiktilaTaunggyi & Kyaingtong-Tachilek: Rehabilitation & maintenance BOTs are in place Capacity Building (Apr 3, 2012) 9Preparation of proposal (Traffic/Economic analysis, Safeguarding, PPP) 5. Myanmar: Takaw-Kyaintong (AH2) Strategic context 1. One of the top priorities in Road Development Plan (3rd Five Year Plan 2011-16). Takaw-Kyaintong section (183km) is the only link without any rehabilitation plan to date. It connects: Mandalay, the 2nd largest city of Myanmar; and Taunggyi, the capital of Shan State borders China, Lao PDR and Thailand 2. It completes the E-W corridor of Northern GMS, which leads to Kyaukphyu seaport in Myanmar at its western end and Haiphong seaport in Viet Nam at its eastern end. 3. It can induce ocean freight through the Malacca Strait to the Kyaukphyu deep seaport by use of the project especially to and from Guangxi Zhuangzu and land-locked Hunan. 5. Myanmar: Takaw-Kyaintong (AH2) Strategic context 5. Myanmar: Takaw-Kyaintong (AH2) Socio-economic characteristics (2010) Population: 48.4 million (Annual population growth: 0.69%) GDP per capita: US $399 (GDP Growth Rate: 12.1%) No. of registered vehicles: 0.42 million (Growth rate 5.0%) Road system inventory (Public Works, MOC) Road Classification Road Length (km) Expressway Class 568 Degree I, II, III Class Degree IV, V Class Degree VI Class Total length 2,413 3,142 11,067 17,190 5. Myanmar: Takaw-Kyaintong (AH2) Technical Feasibility Field Survey: April 4, 2012 Findings and Recommendations 9 Alignment: Frequent steep gradients or sharp curves 9Pavement: Deterioration in the surface condition of DBST especially in the steep gradient section, Below AH Class III 9Bridges: Single lane, temporal, bridges were used widely. 9Social & environmental impact: To secure 2 lane width, additional cutting and embankment are unavoidable. (2 lane ROW is already acquired for future widening) Division of 3 sections 5. Myanmar: Takaw-Kyaintong (AH2) Section 1 (Takaw-Mongpyin, 79km) 5. Myanmar: Takaw-Kyaintong (AH2) Section 2 (Mongpyin-Tontar, 48km) 5. Myanmar: Takaw-Kyaintong (AH2) Section 3 (Tontar-Kyaintong, 56km) 5. Myanmar: Takaw-Kyaintong (AH2) Traffic forecast Current Traffic condition: 76 veh/day (2010) Traffic Projection: max 2,600 veh/day (2045) 9 25% of the traffic on AH14 Muse-Hsenwi section in China, was assumed to be diverted Improvement Plan 9 9 9 9 Alt-1: Alt-2: Alt-3: Alt-4: 2lane 2lane 2lane 2lane DBST pavement, no bridge improvement DBST pavement, 2 lane bridge replacement AC pavement, no bridge improvement AC pavement, 2 lane bridge replacement 5. Myanmar: Takaw-Kyaintong (AH2) Cost estimates Unit cost estimation Preliminary cost estimation Alternatives Alternative-1 Alternative-2 Alternative-3 Alternative-4 Contents Quantity Unit cost (US $) Cost(US $, thousand) 1. Improvement of pavement (DBST pavement) 89 km 210,000 18,690 2. Minor change in road alignment 94 km 550,000 51,700 89 km 210,000 18,690 94 km 550,000 51,700 3,397 m2 2,070 Sub Total 1. Improvement of pavement (DBST pavement) 2. Minor change in road alignment 3. Reconstruction of existing bridges to two-lane bridges Sub Total 1. Improvement of pavement (asphalt concrete pavement) 2. Minor change in road alignment Sub Total 1. Improvement of pavement (asphalt concrete pavement) 2. Minor change in road alignment 3. Reconstruction of existing bridges to two-lane bridges Sub Total 70,390 7,032 77,422 89 km 310,000 27,590 94 km 640,000 60,160 87,750 89 km 310,000 27,590 94 km 640,000 60,160 3,397 m2 2,070 7,032 94,782 5. Myanmar: Takaw-Kyaintong (AH2) Economic Analysis Cost Estimation: Construction, Maintenance (periodic+ routine) Benefits: VOC, TTS (Korean Model) Result of Economic Analysis Contents Alt.1 Alt.2 Alt.3 Alt.4 B/C NPV (US 1,000) IRR 1.257 14,218.9 14.70% 1.152 9,203.2 13.62% 0.985 -1,077.7 11.83% 0.920 -6,093.5 11.07% 5. Myanmar: Takaw-Kyaintong (AH2) Conclusion and Recommendation 1. DBST surfacing with reconstruction of existing one-lane bridges to two-lane bridges is recommended with total cost of USD 77.4m. 2. However, AC pavement option (USD 100m) shall be further investigated considering the durability and maintainability of DBST. 3. Significant change in alignment including tunneling may be needed to secure its strategic role as an alternative of ocean freight through the Malacca Strait since the project road shall induce heavy vehicles mainly in this context. Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections 6. Recommendation 6. Recommendation Challenges in ‘low demand’ countries ¾ Holistic Approach vs. Project-level viability National Priority vs. Financial Viability Equitable Development of Infrastructure Network effect 6. Recommendation ¾ Demand -> Supply vs. Supply -> Demand Korea in 1960s : $100 GDP per capita Investment Forum Pre‐Feasibility Studies of Selected Asian Highway Sections Questions, comments? Contact W. KWON at [email protected] and/or +63-915-940-3338 (Manila) +82-10-2378-0305 (Seoul)