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Acciona managing director Bede Noonan said the Spanish contractor is facing a $1 billion loss on Sydney's light rail project because it did not get Ausgrid's "crap the pants" document on how to handle utilities before contracts were signed in February 2015.
Ausgrid had previously prepared a report for Transport for NSW estimating the cost of moving its utility assets was $700 million, but that report was not been given to Acciona, Mr Noonan told the fifth day of hearings by a NSW parliamentary inquiry into the light rail project on Thursday.
Transport for NSW's decision to give Acciona the guidelines after the financial close of the light rail contract on February 27 was like "dropping a bomb on us", Mr Noonan said, telling the public accountability committee that the government agency had made "a significant mistake".
Acciona, which is building the light rail network that will run along Sydney's George Street and into the city's eastern suburbs, did not receive Ausgrid's utility guidelines from Transport for NSW until after the final contracts had been signed on February 27, Mr Noonan said.
Acciona managing director says delays in receiving Ausgrid guidelines cause delays and cost blow-outs.AAPIMAGE
"Had those Ausgrid guidelines been provided to our consortium in early February then we would not have signed the contracts and this project would not have proceeded in the manner it has," Mr Noonan said.
"Upon receipt of the Ausgrid guidelines, our consortium would have stopped the process and not proceeded with the contract."
Ausgrid chief executive Richard Gross previously told the inquiry that the company's network standards were publicly available before the Altrac consortium, which Acciona is part of, signed the light rail contract and that the guidelines provided on February 27 were to be used to "assist in the interpretation" of the standards.
But Mr Noonan said "the genesis" of the light rail project's cost blow-outs "comes back to not getting the Ausgrid guidelines".
Acciona had initially estimated its construction costs at $870 million when it submitted a tender for the light rail project in 2014, with its contract then accounting for about 40 per cent of the total $2.1 billion project cost.
Acciona managing director Bede Noonan says there is a risk Sydney's light rail project could be delivered later than May 2020. Jessica Hromas
Acciona re-priced the cost of completing the light rail project after receiving the guidelines, calculating it would cost $426 million more and take 865 days longer to complete. Acciona currently forecasts its portion of final costs to be $1.85 billion.
The light rail project, which was initially due to be completed by March 2019, is currently forecast to be finished in May 2020 but Mr Noonan said there were risks that the project would be completed later because it had to liaise with Ausgrid to bring down overhead power lines on Anzac Parade and there had been delays to the work being done by the utilities group.
"There is a risk that it could be later than May 2020," he said, but added the relationship with Transport for NSW had become more collaborative following recent project management changes.
Government committee members also focused on statements made on Acciona's behalf after human remains were found on a Surry Hills development site last month.
An Altrac spokeswoman had initially said in late October that the bones were "respectfully" removed by experts before video footage emerged the next week of a worker tossing the remains onto the road carelessly.
Mr Noonan at first tried to deny the comments had gone out with Acciona's approval - an argument which Nationals committee member Trevor Khan did not accept when he indicated the circumstances of the removal would have been "covered up" without the video - and then said that anthropologists had removed the bones after their initial uncovering.
Liberal committee member Shayne Mallard said Mr Noonan's arguments, "characterised the whole project," after the morning session.
"I was appalled at how he tried to redefine the timing of the removal into two separate parts," he said. "I mean we all saw the video and what actually happened."
The Labor Party's Greg Donnelly intervened as the exchanges between the government politicians and Mr Noonan got more heated. He told Mr Khan to "control yourself" before making a point of order on the emotional language Mr Khan was using in his questions.
"No. You control yourself Greg," Mr Khan barked back. "I didn't know you were his defence lawyer."
Mr Noonan also revealed the worker who removed the bones was not dismissed.
The contractor has suffered "incredible reputational damage" due to the conduct of Transport for NSW, which has blamed the delays on Acciona, Mr Noonan said.
The transport agency has been informally telling foreign contractors that they can "forget about tendering on work" unless they team up with a local partner, and should issue "clear guidelines," Mr Noonan said.
Acciona has alleged the NSW government was "misleading or deceptive" when providing information on how to handle Ausgrid's utilities, in a $1.1 billion lawsuit.
Acciona spent $10 million tendering for the the light rail project, Mr Noonan said, with half of the money spent understanding the scope of work and the risks of dealing with utilities.
This article first appeared on www.afr.com
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