Price 'decisive' for Waterview contract

The Waterview link will cost $1.3 billion. Photo / Natalie Slade

Price was the main decider in awarding the $1.3 billion Waterview project, according to Robert Jones, Leighton Contractors' alliance project director.

"I think it's purely and simply a competitive tender and price," Jones said, indicating the rival Fletcher Construction consortium had offered to do the work for less.

He was commenting after Friday's announcement the Fletcher consortium won the contract for the connection tunnels and Great North Rd interchange in Auckland, a decision by the NZ Transport Agency which left Leighton the loser in the tender for New Zealand's biggest roading project.

Jones said Leighton had spent about $18 million and at one point had 140 people working on its bid.

"That's the way it goes. You go into these bids obviously very hopeful that you have something extra special but at the end of the day, it's price-dominated.

"We put forward a credible bid and we were as keen to win as the other consortium.

"I can't say what price we bid because it's an issue for the agency and it is going through negotiations with the other consortium."

Fletcher said it had a 32 per cent share of the Well Connected Consortium with McConnell Dowell, Obayashi Corporation and three design companies, Beca, Parsons Brinkerhoff and Tonkin & Taylor taking the remainder.

The five-year project has an expected design and construction cost of about $1.3 billion.

"The Well Connected Consortium will form an alliance with the NZ Transport Agency to deliver the project on behalf of the New Zealand Government. The selection of the preferred consortium has been through a competitive process involving a combination of price and non-price attributes and the whole selection process has taken more than a year," Fletcher said.

"The project involves two parallel tunnels under Avondale Heights that are each 13.1m in diameter and 2.4km long.

"The existing interchange at Waterview will be reconfigured with extra connectivity.

"The scheme involves several road and pedestrian bridges as well as considerable amounts of landscaping, environmental mitigation and a number of community assets."

For its bid, Leighton had planned to go overseas for structural steel and reinforcing, considering supplies from Spain, South Africa or China.

"We looked at leveraging against our supply arrangements from overseas," he said.

Leighton has bid to build the new men's prison at Wiri, is completing the $207 million Newmarket Viaduct and working on the $225 million Auckland road maintenance alliance and the $80 million Wellington tunnel upgrades.