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The Flagship Road PPP Project, Elevated Highway from the New Kelani Bridge to Athurugiriya

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By China Harbour Engineering Company Ltd., the bidder for the elevated highway project from the New Kelani Bridge to Athurugiriya

The project is to construct and implement a four-lane elevated highway from the New Kelani Bridge to Athurugiriya with a link to the Baseline road (“the Project”), and was initiated by the Road Development Authority (“RDA”) (under the aegis of the Ministry of Highways of Sri Lanka) in line with the national policy framework of the Government of Sri Lanka and the National Master Plan for the period 2007 to 2017 to enhance the national transport network to enable and facilitate future development and expansion of the Sri Lankan economy.

The Project forms the first fast-track expressway through the main urban area to connect the Colombo Commercial Business District (“CBD”) via the Port Access Elevated Expressway, the Colombo-Katunayake Expressway, the Parliament, the Administrative District, Colombo Outer Circle Expressway, and the Southern Expressway. The Project will not only ease the traffic congestion of the core urban district to and between the CBD area but will act as the major link between the urban express road and national high-speed road network, which is expected to bring significant social and economic benefits for Sri Lanka.

In order to achieve these objectives, the RDA invited potential investors who have expressed interest to submit detailed proposals [in accordance with the Request for Proposal (RFP) published on 6th November 2020] for development of the Project.

The RFP required the investors to forward their proposals to develop the Project under a Public Private Partnership annuity basis on a Design, Build, Finance, Operate, Manage and Transfer model (DBFOMT). As per the model proposed thereunder, the Concession holder will operate and maintain the elevated highwaythe Project during the whole Concession Period. The toll revenue generated from the Project will be collected by the RDA and will be remitted to the fiscal revenue. As a return of investments made by the Concession holder and as a payment for the services provided in the operation and maintenance of the Project, the Concession holder will become entitled to timely fixed Semi-Annual Service Payments. On the completion of the Concession Period of this Project, the Concession holder is required to handover the operations and maintenance of the Project to the Government of Sri Lanka. The call for proposals, selection, negotiations and all other processes were carried out in accordance with the approved Government procurement procedures set out in the Procurement Guidelines of 1998. As this Project is 100% funded by foreign investments, the Government of Sri Lanka is not burdened with the requirement to source funds for the development and implementation of the Projects.

Out of the two bidders which submitted proposals in response to the RFP, one bidder became disqualified owing to their failure to fulfil the RFP conditions. Consequently, on the 7th April 2021, the Cabinet of Ministers approved a proposal tabled by the Ministry of Highways to commence negotiations with China Harbour Engineering Company Limited (CHEC) to finalise the transaction documents.

From then on to November of 2021, CHEC and the representatives of GOSL have constructively reviewed and, in accordance with international standards, finalised the transaction documents to ensure that the Project can be implemented effectively within a mutually beneficial framework. In 2022 The finalised transaction documents were reviewed by the office of the Hon. Attorney General and the parties have incorporated the suggestions made by Hon. Attorney General.

To date, the Project has not yet been concluded. For this project,CHEC as an international bidder attending the Tender has allocated substantial resources in relation to design, surveys, investigations as well as legal consultancy in order to optimize implementation ground of the Project for the interest of both public and private parties. Even though this Project has suffered unexpected delays in its finalization at a crucial point where the entire world and the country is entrenched in uncertainty, CHEC has expressed its commitment made to the Government of Sri Lanka under its proposal for this Project and to support the development of this Country in a mutually beneficial manner.

Saturday, January 28, 2023 – 14:50











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