Badgerys Creek first stage runway and terminal to cost over $5bn

Infrastructure Australia has costed the first stage of the Badgerys Creek airport at $5 billion.

Infrastructure Australia has costed the first stage of the Badgerys Creek airport at $5 billion and listed the mammoth project as a high priority that needs to be built to ensure Sydney Airport does not become a bottleneck and destroy the nation’s future capacity for air travel.

The addition of the proposed Badgerys Creek airport to the high-priority list means the project has received a blessing from the nation’s independent infrastructure adviser to be built with government or state-designated funds should Sydney Airport ultimately decide not to build the project itself.

Sydney Airport Corporation has the right to decide if it wants to run Sydney’s second airport as part of the contract for the privatisation of Kingsford Smith agreed to by the Howard government. The deal gave it the first right of ­refusal for the following 30 years over any new airport within 100km of Mascot.

A final airport plan — to include a 3700m single runway capable of taking jumbos and A380s and a single terminal capable of handling 10 million passengers by 2030 — will be handed down by the federal government to Sydney Airport by the end of this year.

The corporation will have until April next year to decide if it will take on the mammoth infrastructure project.

In its report on the new airport site, Infrastructure Australia assessed that stage one of the ambitious plan — which would include the single runway, terminal and civil works — would cost $5bn.

Further works to expand the airport to its full potential — including a second runway, roads, rail access and other surrounding infrastructure such as shopping precincts — would cost another $38bn.

The business case expects that all off-site supporting infrastructure, including road and public transport infrastructure to link Western Sydney Airport with Sydney’s ground transport system, would be provided by the NSW government in consultation with the federal government.

Despite the high costs of the project, the report said it was important the second Sydney airport was built to relieve an unbearable strain on Kingsford Smith in coming decades due to its highly constrained site “with limited opportunities for expanding terminal capacity, and no practical option for additional runway capacity”.

“Under current constraints, Sydney Airport will become unable to meet demand for new services ... By around 2035, there will be practically no scope for further growth of [Regular Public Transport] services at the airport,” said IA’s assessment of the Badgerys Airport project.

As Australia’s primary aviation gateway, Sydney accounts for around 40 per cent of international services, 43 per cent of domestic services, and 45 per cent of international air freight.

Demand for Sydney’s airport services is forecast to significantly grow in coming years with passenger numbers expected to reach 76 million per year by 2030 – increasing to 165 million by 2060.

“Kingsford Smith Airport alone would not be able to service this growth. Capacity constraints would increase the cost of doing business, hinder international trade and have adverse impacts on export- driven industries such as agriculture and manufacturing which are major employers in our regions,” said Infrastructure Australia chief Philip Davies.

“Western Sydney Airport shows how preserving land and corridors to meet future infrastructure needs can deliver the best outcomes for both infrastructure users and the broader economy. We are the beneficiaries of past decisions and we should do the same for future generations.

“The airport will attract investment, unlock the region’s potential as a tourism destination and create more jobs for people closer to where they live.”

Infrastructure Australia recommends the ultimate operator of the airport undertake a post-completion review after each stage of the project has commenced operation. In particular, each of these reviews should update the stated cost-benefit for the entire project in the light of the stages already completed, potential changes to its design, and any revisions to the timing of remaining stages.