Hong Kong Infrastructure Update – MTR and Lantau Tomorrow (or the Day After)

5th March 2024

As the Year of the Dragon begins, there is a lot of movement in the Hong Kong infrastructure market in what promises to be a very busy year.

MTR Projects

Following the commencement of the Tung Chung line extension and the Kwu Tung station project last year, MTR finished 2023 with awards of two significant civil contracts in December. Contracts 1501 and 1502 for the construction of the Tuen Mun Station, Viaducts and associated river crossings were awarded under a single combined contract to a joint venture of CRBC-Build King. The project has been awarded under a design and build NEC 4 contract.

Tuen Mun South Extension

The project will see the Tuen Ma line extended 2.4km south to Tuen Mun Ferry Pier with two new stations at Tuen Mun Area 16 and Tuen Mun South. The station at Tuen Mun Area 16 is additional to the RDS2014 study and will serve approximately 49,000 residents whilst 60,000 residents will benefit from the Tuen Mun Ferry pier station. A separate contract 1503 (awarded to Build King under a separate NEC Option C Design and Build Contract) will require the re-provisioning of the Tuen Mun swimming pool to facilitate the new station at Area 16.

For the Tung Chung line, the new Oyster Bay station development has been awarded to China State Construction under an NEC4 Option C contract. This development was originally announced in the November 2020 policy address and comprises redevelopment of the Siu Ho Wan depot (perhaps a less catchy name) to accommodate housing.

Oyster Bay, Formerly known as Siu Ho Wan Depot (c) David Feehan

The redevelopment of the site has been a long term proposal but with the heightened urgency of the Hong Kong housing situation, has gained increasing importance.

Oyster Bay Artist Impression

The project will see the construction of a reinforced concrete deck over the depot and the construction of 21,000 flats over a period of 20 years. A new station will service the site. Construction of both Oyster Bay and Tuen Mun extensions are expected to be complete in around 2030.

The Northern Link and the Airport Overrun Tunnel will be the next projects to be tendered.

Meanwhile, the government have been re-assessing the schemes for Kai Tak and Kwun Tong with light rail systems being considered for both. This follows criticism of the government for scrapping a proposed monorail system in 2020 saying that Kai Tak was severely constrained by adjacent developments. Several mainland companies have expressed interest. Congestion in the area is only likely to increase with the opening of the Kai Tak Sports Park in 2025.

The North Island Line has been deferred following signalling upgrades to the existing lines and capacity increases from the Shatin Central Link. The line will link the existing Hong Kong Station with North Point through new stations at Tamar and Causeway Bay North via the recently completed Exhibition Station. It is anticipated that the scheme will be deferred at least 10 years.

North Island Line as envisaged in the Railway Development Study 2014

East Lantau Metropolis

As we have seen in many jurisdictions, the impact of COVID, increased construction costs and higher borrowing costs are combining to crimp policy makers abilities to progress with infrastructure development. Recent high profiles casualties include the Northern leg of UK’s HS2 project and a federal spending review cutting 50 infrastructure projects in Australia. Hong Kong’s ambitions have suffered a similar fate with the government announcement that the East Lantau Metropolis, an array of artificial islands in the harbour approaches, would be delayed by up to 2 to 3 years. This came on the back of a budget deficit of HK$100 billion.

Kau Yi Chau (c) David Feehan

The government indicated that the project, which is currently the subject of detailed feasibility and design studies, is targeted to commence before the end of the current government’s term. The delay would also allow the government to focus on the Northern Metropolis mega project.

Contract Dispute Consultants (CDCHK)

CDCHK are Hong Kong’s leading claims and contractual consultancy providing support to first tier contractors working on complex infrastructure and building projects worldwide. Recent assignments have included acting for contractors on rail projects in Canada and Hong Kong, cable stayed bridges in the United States, Canada and Hong Kong, power projects in the UK and airport projects.