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NEITHER THE CITY OF BUDAPEST NOR DBR CHANGE THEIR PREVIOUS POSITION – AND ASK NOT MORE EITHER, THAN THAT BAMCO UNDERTOOK UNDER ITS CONTRACT
Upon the request from the Head Mayor, managers of the DBR Project Directorate gave an account about the status of negotiations with BAMCO consortium to the leaders of caucuses at the five-party meeting on Budapest’s budget this morning. Opinions of the city of Budapest, BKV and DBR are still unambiguous: BAMCO consortium led by the French Vinci – abandoning its illegitimate attitude – should forthwith proceed with works. DBR again calls upon the tunnel builder to continue works done by the company and to use available legal options in lieu of threats and breach of contract and to confirm that whether it still complies with the financial and technical requirements undertaken at the time contract signing. The Client’s interest is still that that tunneling works should continue as soon as possible, but not for any costs, and if BAMCO does not comply with the instruction, DBR is ready to terminate the contract. By this otherwise DBR is still not asking more than to complete works undertaken in the contract in lieu of unrealistic claims. According to the involved international experts, if parties settled all disputed issues, it is eventually conceivable that BAMCO would owe to the Client.
BAMCO consortium led by the French Vinci and comprising the Austrian Strabag and the Hungarian Hídépítő suspended tunnel building and other works done by the company on 14th April, after its unrealistic claim of 35 milliard Ft noted under its ultimatum was not fulfilled by the DBR Metro Project Directorate. At the very same day the Client called upon the tunnel builder to proceed with works, and it has not been satisfied by the consortium up to date. DBR has been continuously examining the ever growing number of claims of BAMCO, by which the tunnel builder slowly want to double the contractual price of 62 milliard Forints undertaken originally. DBR unambiguously dispute that the stopping has merit: the amounts of claims and in most cases their reference ground also are unrealistic, moreover unfortunately the consortium is not attempting to settle the dispute through the legal way undertaken by it as well.
DBR CALLS UPON TUNNEL BUILDER TO PROCEED WITH WORKS – STOPPING AGAIN BY BAMCO CONSORTIUM LED BY THE FRENCH VINCI IS ILLEGITIMATE
BAMCO consortium led by the French owned Vinci Construction with members of the Austrian Strabag and Hungarian Hídépítő suspended tunnel building and other works again today. Background of the issue is that the consortium submitted a claim with an unrealistically high amount of nearly 35 milliard Forints to DBR, while the whole work should be completed from approximately 62 milliard Forints as per the contract. Position of DBR is clear: the claim is deemed being without merit, therefore DBR calls upon the consortium to proceed with works. Provided the consortium does not perform within 14 days, DBR will be forced to terminate the contract. Irresponsible attitude of the consortium led by the French company compromises the jobs of several hundreds of Hungarian workers, thereby the living of several hundreds of Hungarian families.
As known, in its latest ultimatum BANCO Kkt. comprising Vinci, Strabag and Hídépítő demands some 35 milliard Forints, and gave 30 days for full compliance, otherwise envisaged termination of its contract of nearly 62 milliard Ft. DBR has been continuously examining the ever growing number of claims, of which almost 190 were submitted by the consortium, which is more than all the other claims together submitted by all the other contractors. The Company’s step now especially with the attitude used and the unreasonable as well as unfeasible conditions exceeds all limits according to the opinion of the Client.
METRO 4 HAS AN INDEPENDENT SUPERVISING ENGINEER
In the last weeks several such commentaries – independent from DBR Metro Project Directorate – emerged, which as per our opinion unreasonably questions technical information provisions in connection with metro 4. Metro 4 has an independent supervising Engineer, who provides necessary technical and legal information in all cases, thus with special reference to contracts made in connection with metro 4. Besides the open and increased communication to the public, technical information is getting to the competent bodies through several other channels too, thus to the General Meeting of Budapest, and to its committees. In the name of transparency on the website of DBR nearly 40 contracts can already be found, otherwise not violating business secrets.
According to the contract made between the Municipality of Budapest and BKV Zrt. on the tasks of the investor for the first section of metro 4, BKV Zrt. with the agreement of the city of Budapest has to employ an independent supervising Engineer in order to control investor’s decisions and completion of the project, and this is also required by the credit contract made between the European Investment Bank and the city of Budapest. In compliance with the changed financing conditions, preparations are concluded, and the independent supervising Engineer’s public procurement procedure is in process.
PLATFORM TUNNELS AT FŐVÁM SQUARE WAITING FOR THE TUNNEL BORING MACHINES – IF LEGAL DISPUTE SETTLES WITH THE TUNNEL BUILDER, THE NEW METRO WILL BE COMPLETED BY 2011.
Today in several media outlets ambiguous news was released about the finish of metro 4, and respectively the anticipated date of its handover. Therefore herewith we inform the residents of Budapest about the expected finish and present status of the project. Building works of the platform tunnels connecting to the Fővám Square station of metro 4 is finished, and it allows BAMCO to start test borings necessary to build metro tunnels under the Danube. By this the Danube side station has reached a completion degree suitable to receive the TBMs. This morning journalists with a joint guidance of DBR and Hídépítő visited the structure-ready station and the tunnel section stretching under the river, built with a special methodology. This also means that if the legal dispute with BAMCO consortium settles, then by 2011 the new metro can be physically completed and the system-start as well as the test run may commence.
On both sides of the Danube ensued from the close proximity of the river and buildings, two narrow station designs were the valid option, and platform tunnels stretching out of these will allow the train to stop with its full length at the future station. As known some experts and designers as the works progressed deemed the chosen building methodology risky, and therefore continuous negotiations began with the DBR Metro Project Directorate. Eventually the negotiations between DBR and Hídépítő Zrt., which in the meantime became Hungarian owned, about the building methodology of platform tunnels stretching under the Danube, concluded favorably for the city of Budapest and hence building of the station could proceed safely before the arrival of TBMs, and respectively for by scales less costs than with the artificial island option proposed by the French experts.
WHAT TRUE IS TRUE – FACTS ON METRO 4
In reaction to the misinformation due to inaccuracies or purposely done in the past days DBR Metro Project Directorate collected the issues frequently occurring, but, even in spite of the immediate and full information release, appearing differently almost everywhere. DBR has never stated that it builds the World's best metro with the fastest and cheapest way, but its opposite is not true either. In Hungary metros have not been built for decades, sufficient know-how was absent for a long time, preparations were slower than anticipated, but the present staff of experts can handle the technical hardships, and by now implementation works proceed with good pace and on high level everywhere, regardless of that that some companies submit unrealistic claims.
It is not true that the World’s most expensive metro is being built. Some metro constructions are cheaper, some are more expensive than the one in Budapest (diverse soil conditions, surface crowded with old buildings, presence of the Danube, etc. are raising the costs here). Not only Rome and Athens, but also France, England, Germany, Japan and the United States have had more expensive metro lines built recently, considering the average price per km, metro 4 belongs to the upper third of the middle field (if we could say that, it is 12 on a scale of 20). If we want to take objective examples, not only the Madrid and Mallorca case exist as exemplarily circulated on the Internet. (And by the way for Madrid the prices shown are that of a project calculated with net prices without metro carriages and as built by connecting existing network elements, and for Mallorca it is a small capacity beach tourist-vehicle, which after handover was needed to be closed down right away due to water leakage.)
NEGOTIATIONS CONTINUE ON THE ISSUE OF ADDITIONAL DEMANDS
In its newest letter, in addition to its extra demand of 13 million Euros paid earlier without prejudice to later account, now BAMCO consortium formed by Vinci, Strabag and Hídépítő demands some 115 million Euros. This one and its other demands slowly make nearly the amount, for which the company has originally undertaken the construction of the tunnel, the TBM launching shaft and the station at Szent Gellért Square. For months DBR has been continuously negotiating with the consortium, continuously assessing the ever growing number of additional demands. Under another ultimatum BAMCO gave 30 days for the full completion, otherwise envisaged termination of its contract of 207 million Euros. According to the opinion of DBR this attitude, in addition to its being unethical and immoderately exaggerated, is likely scratching the limit of breach of contract.
BAMCO’s method and its step now are not new, as last summer the company already planned to suspend its works, provided its additional cost demands, exaggerated also, submitted to the Client were not fulfilled. For months DBR has been assessing the company's continuously increasing additional works claims, those with merit were paid, even the earlier disputed amount of 13 million Euros were transferred without prejudice to later account. But claims without merit will still not be fulfilled by DBR, not even upon the influence of ultimatums, during the negotiations DBR acts with strongly bearing in mind the interests of the city of Budapest and taxpayers. DBR is still open for negotiations within reasonable and acceptable frames, but BAMCO's attitude now is already exceeding all limits that are usual in business affairs.
TUNNEL BORING MACHINES (TBM) AT HALF WAY: TUNNELING WORKS IN BUDA COMPLETED
The south TBM also “broke into” the future Szent Gellért Square station of metro 4 on Monday afternoon, 16th March 2009, to where its north pair already arrived at the middle of January. By this half of the first 7.5 km section of tunnels is completed. Arrival of the TBM means the end of the Buda side tunneling works, too.
With the north TBM the BAMCO consortium in hand with the authority's consent had already started building works to the remaining tunnel stretch at Buda side at the beginning of January and by the middle of the month reached the platform tunnel linking to the Szent Gellért Square station. The south TBM could be launched following this only, but prior to its arrival the Contractor still had to finish the internal walls of the concerned station part.
ABOUT THE SAFETY OF METRO 4 CONSTRUCTION
For the time being we know about the exact causes of the collapse of the Cologne Archives building only as mush as published in the press. According to the news the tragedy occurred adjacent to a tunnel section, which was being built with a methodology somewhat different than that of Budapest. For metro 4 the experts use open construction method only for the building of station structures and train-turning facilities of end-stations, but these stations as well as other facilities are built with the most state-of-the-art methodology. In case of tunneling works it is the same. Tunneling method with a TBM is definitely amongst the safest ones. It is needed so, as the alignment of metro 4 runs almost all along under built up surface and old buildings.
With regard to the 10 stations for 9 locations the structure building works have already been completed with no problems, and also for the Baross Square site this process will end soon. Not long ago TBMs finished the Buda side tunnel building with almost no trouble. We are waiting only for the inside wall of the three layers to be also finished after the supporting structures at Gellért Square within a few weeks, and for the TBMs to be able to get into the station structure.
GROUND WATER LEAKAGE A NATURAL ACCOMPANYING PHENOMENON
A few centimeters of surface subsidence and ground water leakage are natural accompanying phenomena of every civil engineering works. These hardly have visible signs inside the station, they calmed down as works speeded up, but they are continuous associated phenomena.
A stretch of as much as 7.6 km has been completed of the tunnels. The south TBM may break into the Szent Gellért station in the first half of March, while the north one has already arrived in January. However, TBMs can be drawn into the station after the internal wall building works are finished, for it is the responsibility of the general design and build company completing the station to ensure maximum safety in the environment affected by works.
ACCIDENT HAPPENED ON THE METRO CONSTRUCTION AT BAROSS SQUARE – One of the Constructor's machine operators died
This afternoon at work an accident happened to an employee of one of the Contractors to metro 4 at the Keleti Railway Station. A piece of a provisional concrete structure under demolition fell and hit the machine operator as leaving his machine, he died instantly.