ECONOMIC AND FINANCIAL ASPECTS OF THE TUNNEL

This brief article described the method used to finance the Du Toitskloof (Huguenot) tunnel. As the loan that the project could support was less than the full cost, the extra money required was obtained by toll revenues and fuel tax. The loan supportable by revenue (lsr) of each toll project determines the size of the capital market loan portion of the capital cost. The lsr was found by discounting to present worth (at a suitable interest rate) the net toll revenue in each future year in the study period, calculated from traffic increasing at the expected rate (computed from traffic demand projections) and allowing for an increase in tariffs due to inflation each year. The financial strategy for the tunnel included, firstly, the construction period phase, which involved the procurement of capital market loans equal to the lsr. Six loans to the value of R54.5 million were taken out over different terms and at different interest rates to assist in the construction cost. The remainder of the construction cost and the payment of the interest on the capital loans during this period were funded from the national road fund. The second phase, during the initial operational years of the tunnel project, involved the payment of interest on the loans from the net toll revenue and from the fuel levy income. The final phase included the payment of interest on the loans and the establishment of redemption funds from net toll revenue only, from which both the capital market loans and the national road fund contributions will be repaid. (TRRL)

• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/issn/00097845
• Corporate Authors:

  South African Institute of Civil Engineers

  9 St Davids Place, Parktown, P.O. Box 62129
  Marshalltown,   South Africa 
• Authors:
  • Petzer, E
  • Jamieson, R
• Publication Date: 1988-4

Media Info

• Features: References;
• Pagination: p. 169-170
• Serial:
  • CIVIL ENGINEER IN SOUTH AFRICA
  • Volume: 30
  • Issue Number: 4
  • Publisher: South African Institution of Civil Engineers
  • ISSN: 0009-7845

Subject/Index Terms

• TRT Terms: Construction; Financing; Fuels; Taxes; Toll roads; Tunnels
• Geographic Terms: South Africa
• ITRD Terms: 3655: Construction; 244: Financing; 3850: Fuel; 8103: South Africa; 268: Tax; 2702: Toll road; 3374: Tunnel
• Subject Areas: Bridges and other structures; Construction; Economics; Energy; Finance; Highways; Society;

Filing Info

• Accession Number: 00493088
• Record Type: Publication
• Source Agency: Transport Research Laboratory
• Files: ITRD, TRIS, ATRI
• Created Date: May 31 1990 12:00AM