EU bank set to help with rail loans

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THE GOVERNMENT, which has sought billions of euro worth of EU loans to build Metro North and a major extension of the Dart network, has been promised “fruitful co-operation” by the European Investment Bank.

Minister for Transport Noel Dempsey met EIB vice president Plutarchos Sakellaris in Luxembourg yesterday to discuss the Government’s proposed transport investments. During a meeting which he described as “very productive”, Mr Dempsey emphasised “the political and strategic importance of the Metro North and the Dart Underground projects”.

Two consortia have been short-listed to build the Metro North project, running from St Stephen’s Green to Swords.

The first is the Celtic Metro Group (Barclays Private Equity, Obrascon Huarte Lain, Mitsui, Soares da Costa, Iridium Concesiones de Infraestructuras SA, CAF and MTR).

The second, known as Metro Express, is comprised of Macquarie Capital, Global Via Infrastructuras, Allied Irish Banks, Bombardier and Transdev RATP. The Rail Procurement Agency hopes to begin work next year.

The Dart Underground project bids to connect existing Northern Line services to services running from Heuston Station on the west of the city. New stations will be built at Docklands, St Stephen’s Green and High Street, linking with Pearse and Heuston stations.

Responding to suggestions that the Department of Finance does not support Metro North, a spokesman for the department said: “We do not have a principled objection to the metro, but we will have to see how much it costs. We have never said that we are against it, but it depends on how much it costs.”

The attitude taken by the European Investment Bank will be crucial, since it will make it much easier to attract private banks to back the projects if it decides to offer funding.

Speaking after the meeting, Mr Sakellaris said: “The European Investment Bank has been standing by Ireland’s side for many years, and I would like to assure Minister Dempsey once again that we definitely intend to uphold our very fruitful co-operation.” So far, the EIB, which made its first loan to Ireland in 1973, has lent €10 billion for Irish projects, including a €300 million loan in March this year to Allied Irish Banks, Ulster Bank and Bank of Ireland to help small businesses.

Enjoying an AAA credit rating, the EIB – the European Union’s long-term lending arm, borrows money at favourable rates on international capital markets to back infrastructure projects. Last year, it lent over €50 billion for EU projects.