The completion of the high-speed Channel Tunnel Rail Link (CTRL) between London and the Channel Tunnel is being part-financed by the European Investment Bank through a £400 million loan (EUR 560 million). The finance goes to London & Continental Railways Limited (LCR) for Section 2 of the public private partnership CTRL project between the end of Section 1 at Southfleet, and a new international terminal at London St. Pancras. CTRL Section 2 will provide the final high speed link connecting London with Paris, Brussels, Amsterdam and Cologne and the wider European high-speed rail network.
Section 2 involves the construction of the line between Section 1 of the CTRL at Southfleet and St. Pancras Station, London. Section 1 from the Channel Tunnel to the outskirts of London via Ashford is due to open later this year, and benefited from an EIB loan of £200 million in 1998. Section 1 will reduce journey times between London and Paris/Brussels by around 20 minutes, and Section 2 will provide a further 15 minute gain in addition to releasing scarce capacity on South London commuter routes.
The loan was signed today in London by EIB President, Philippe Maystadt and Rob Holden, Chief Executive Officer of LCR.
President Maystadt said: The EIB has consistently supported this project since its beginnings in the mid-1990s. EIB finance now goes towards the completion of a priority link in the European Union's Trans European Network of high-speed rail lines. It will bring London closer to other European capitals through direct connections with Paris and Brussels, permitting rapid onward high speed connections to other key cities such as Amsterdam and Cologne. By providing international rail users with time savings and increased service reliability, it will improve the competitiveness of rail relative to air and road transport. Financing such major European transport networks is a key EIB priority.
At the same time, the project's second phase will have a direct impact on urban regeneration in East London and the Thames Gateway area. This will be stimulated through a comprehensive major redevelopment centred on the new Stratford station which is to become a transport hub for Eastern London, and through improved access to Thamesside and the Medway towns.
Rob Holden, CEO of LCR said: The EIB have been long-standing supporters of the CTRL project and this loan facility will allow us to complete the funding arrangements for the construction of Section 2 of the CTRL in advance of the scheduled refinancing of Section 1 to take place later this year or early next. The CTRL project is being progressed in line with expectations and continues to have robust financing arrangements. Work with our development partners at Kings Cross, Stratford and Ebbsfleet is going well with over £8bn of investmentanticipated at these sites following the opening of the completed railway in early 2007
Supporting the development of the Trans European Networks is a key EIB objective. With this loan it will have provided EUR 2.4 billion for the UK, Belgian and Netherlands sections of the Brussels, Paris, Köln, Amsterdam, London (PBKAL) high speed railway network. PBKAL is one of the 14 priority TENs projects identified by the EU's Heads of State at the Essen Summit in 1994, as crucial for underpinning the economic development of the EU.
The CTRL project consists of a 109 km twin track high-speed passenger and freight line between London's St Pancras Station and the Channel Tunnel. The second section includes 25 km of tunnels under London and the Thames, as well as the new international station at Stratford and major reconstruction works at St Pancras Station. CTRL will have the capacity to carry up to between 40-45 million passengers a year.
Once CTRL is completed in early 2007, it will bring a substantial improvement to international services in the UK by providing a continuous high-speed route between the Channel Tunnel and London. CTRL will be directly linked into the West Coast Main Line providing access to Birmingham, Manchester and Glasgow as well as the East Coast Main Line. It will also provide new capacity for domestic commuter services in the South East, allow the introduction of high-speed commuter services to London, free-up capacity on existing lines, and contribute to urban regeneration in the East London and East Thames areas.
LCR was established to design, develop and own the CTRL. Its principal shareholders include: Bechtel Ltd, London Electricity plc, National Express Group PLC, SNCF, and UBS Warburg. LCR owns the UK partner in Eurostar services from London to Paris and Brussels.
The European Investment Bank finances capital investment furthering EU integration, in particular: regional development, trans-European networks in transport, telecoms and energy, industrial competitiveness and integration, small and medium sized enterprises, environmental protection, energy security, and health and education projects. It also operates outside the EU within the framework of the EU's co-operation external policy. Owned by the EU Member States, the EIB raises its funds on capital markets (AAA issuer). In 2002, the EIB lent some EUR 40 billion, of which EUR 3.3 billion in the UK.