The National Highways Authority of India today awarded a Rs 1,043-crore contract to a joint venture between Essar Projects and Atlanta, which will fetch it a premium of about Rs 250 crore.
The contract is for widening of 125.9 km Lucknow-Sultanpur stretch in Uttar Pradesh under the National Highways Development Project (NHDP), the flagship road building programme of the Ministry of Transport and Highways.
"We have successfully awarded Rs 1,043.5 crore Lucknow-Sultanpur to a Essar-Atlanta JV. The concession period is of 23 years including two-and-a-half years of construction time," a senior road ministry official told PTI.
The bidder has agreed for annual premium of Rs 9.6 crore which will result in a total payment of about Rs 250 crore to NHAI, he said.
The project for four-laning of the stretch will be built under NHDP phase IV in public-private-partnership (PPP) mode on design, build, finance, operate and transfer (DBFOT) mode.
A total of 34 players, including Gammon Infrastructure, L& T Infrastructure, HCC Concessions and IL&FS Transportation, have shown interest in the project.
The development comes close on the heels of NHAI bidding out projects like Kishangarh-Udaipur-Ahmedabad at Rs 636 crore annual premium for 26 years to Bangalore-based GMR Infrastructure on July 29.
Highways developers bid premium if they find the project lucrative; the private companies are confident that the toll revenue accruing to them would be more than their total cost.
Earlier, NHAI virtually used to provide grants on schemes to road developers to make the projects viable.
READ MORE ON Essar Projects and Atlanta, National Highways Authority of India, National Highways Development Project, Essar-Atlanta JV
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