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Veidekke in new PPP project: Contract signed with Public Roads Administration

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The Public Roads Administration and the company Allfarveg AS have signed a contract for construction, operation and maintenance of the PPP project E 39 Lyngdal - Flekkefjord. The contract present value is approximately 1.2 billion NOK. Construction will start immediately and the road is scheduled for completion in September 2006. Allfarveg AS is owned 50/50 by Veidekke ASA and Sundt AS. Veidekke Entreprenør AS heads the joint venture that will build the road, and Kolo Veidekke AS will take care of operation and maintenance.
This contract is for the second of three PPP projects (Public Private Partnership) that the Norwegian Parliament has decided to carry out. The first PPP project was E 30 Klett - Bårdshaug in Sør-Trøndelag. The contract is for approximately NOK 1.2 billlion and includes construction of 18 km of new road between Feda and Handeland in addition to upgrading the existing road between Lyngdal - Feda and Handeland - Flekkefjord. For a period of 25 years, Allfarveg will also have the responsibility for operation and maintenance of the new road and the existing road between Lyngdal and Flekkefjord, a total stretch of 38 km. This is the largest contract that Veidekke has entered into.


The new stretch of road will have as many as seven tunnels and eight bridges, including a new suspension bridge across the Feda Fjord, a bridge that is going to be an important landmark in the area when it is completed.


Construction of the new E 39 will be carried out by VKR Gruppen, a joint venture between the two Veidekke companies Veidekke Entreprenør AS and Br. Reme A/S in addition to Kruse Smith AS. Veidekke's share is approximately 70 per cent. During the operating phase operation and maintenance of the road will be taken care of by Kolo Veidekke AS, which is a major player in this market.


Allfarveg AS is investing approximately 120 million NOK in the project. The project will also be financed through loans from DnB NOR in cooperation with the European Investment Bank (EIB) and Nordiske Investeringsbanken, NIB (Nordic Investment Bank).


"We consider this PPP contract to be both exiting and challenging, says president and CEO of Veidekke, Terje R. Venold. "We will have the opportunity to draw on the total Veidekke Group and their competence. Through this project we hope to gain experience that we may make use of in later cooperation with the road administration for new construction projects, says Venold.


Construction will start at the beginning of May. The maintenance period and traffic on the stretch Lyngdal - Flekkefjord will start in September 2006.
For further information, please contact:
President and CEO Terje R. Venold, Veidekke ASA,
phone +47 905 82 323
Chairman of the Board Espen Moe, Allfarveg AS,
phone +47 920 55 093
Managing Director Torgeir Øvstebø, Allfarveg AS,
phone +47 95136609
Director of Finance Jørgen G. Michelet, Veidekke ASA,
phone +47 917 43 856
Senior Vice President Communication, Kai Krüger Henriksen,
Veidekke ASA, phone +47 905 19 360

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