Fresh hurdle in nearly $15bn Metro Tunnel project

The project has been hit by ‘unpredictable events’ and has faced challenges such as a shortage of construction workers, supply chain constraints and disruptions caused by Covid.

Fresh doubt has been cast on Victorian Labor’s ability to deliver the almost $4bn over budget Metro Tunnel by the end of next year, after new documents revealed the major project faces a fresh 12-month delay.

Originally costed at $11bn, taxpayers earlier this year were forced to fork out an extra $745m to cover delays to the 9km twin train tunnels that will connect east and west Melbourne, bringing the estimated cost to $15bn.

Now, a contract variation tabled in parliament on Thursday shows the date for the “provisional acceptance of tunnel and stations PPP (public private partnership)” has been moved to April 2025, delayed from April 2024. “Unpredictable events have significantly impacted the schedule of large-scale infrastructure projects across Australia, including the Tunnel and Stations PPP,” the document states.

“The project has suffered from the impacts of the shortage of construction workers, supply chain constraints, and disruptions caused by Covid-19, causing delays to the works and planned testing and commissioning activities.”

Despite the fresh hurdle and new completion milestones, the document says that 2025 remains the “committed date” for an opening. The date for the “final acceptance of the tunnels and stations PPP” is listed for December 31, 2025.

The Metro Tunnel was scheduled to run trains in 2026, however in 2018 former premier Daniel Andrews brought the timeline forward by a year.