High-speed rail project: delays and new plans for 2025!

High-speed rail project: delays and new plans for 2025!

In a recent twist to the long-awaited high-speed rail project to connect Don Mueang, Suvarnabhumi and U-Tapao, Phiphat Ratchakitprakarn, the Deputy Prime Minister and Minister of Transport, announced his commitment to the project launch. Loud Kaohoon Phiphat plans to hold an urgent meeting with the contracted consortium, Asia Era One Company Limited, a joint venture led by Charoen Pokphand Holding Company.

The start of the project has now been delayed by six years. Phiphat emphasizes that during the upcoming meeting, all obstacles will be identified and solutions will be discussed in accordance with the existing contractual conditions. The Ministry of Transport (MoT) will examine all relevant matters and, if necessary, refer them to relevant authorities. Despite weighing down rumors that the contract may be terminated, the MoT reiterated that there are currently no such plans.

Contractual challenges and payment plans

A key concern is the discussion on the payment plan, which initially envisaged annual payments over ten years totaling THB 149.65 billion. However, the revised contract now stipulates that payments should be based on construction progress and not exceed THB 120 billion. But the ministry is ruling out requests for changes because they could be risky and potentially illegal. Additionally, Asia Era One must provide additional guarantees amounting to THB 152.16 billion to ensure timely progress.

Phiphat stressed that a clear solution must be found within four months and noted that alternative rail systems, such as the existing dual-track railway from Bangkok to Laem Chabang, could serve as options if the high-speed project runs into difficulties again.

Review and Approvals

Chula Sukmanop, Secretary General of the EEC Policy Committee, also confirmed that the contract is currently being reviewed by the Attorney General's Office and final clarification is expected by mid-June. This process is important to incorporate potential contract changes critical to the 2029 completion target. Approval to sign the changes is scheduled for July 2023, after the MoT has already engaged with the SRT board.

At the same time, infrastructure development in the region is witnessing additional efforts to advance projects, as reported in the report by Thai Times The Eastern Aviation City initiative and the electric rail mass transit line in Nakhon Ratchasima are further steps to advance national transport projects and ensure an overview of nationwide mobility requirements.

Consistent concerns over the resignation of Veerit Amrapal, the governor of the State Railway of Thailand, linked to these challenges add to the complexity of the situation. This means that the upcoming negotiations for the high-speed project must be concluded as quickly as possible in order to avoid a legal termination of the contract.