Hong Kong's ExCo approves in principle US$17 billion third runway project

2012 03 22

HONG KONG's Executive Council, the territory's appointed upper house, has endorsed a plan to construct a third runway at Hong Kong International Airport at a cost of HK$136 billion (US$17.5 billion).

The Airport Authority Hong Kong had sought permission to build a third runway in a bid to keep up with the rapid growth in air traffic. The airport's two existing runways are forecast to reach capacity by 2020.

"The Executive Council has approved in principal the airport authority's recommendation to adopt the three-runway system as the future development option for its next stage of planning," said Secretary for Transport and Housing Eva Cheng, according to Reuters.

Ms Cheng said the airport authority has been granted permission to proceed with an environmental impact assessment and draw up plans for the design and financing of the project. The assessment is expected to take two years.

In response to public concerns about the impact of the third runway at Hong Kong International Airport, the Transport Secretary said the government has asked the airport authority to conduct the environmental study in a "strict and professional manner, looking at marine ecology, noise and air quality".

Ms Cheng said the government wants the authority to complete the assessment, design and financial options by the end of 2014, in order for the runway to be built by 2023.

A high-level steering committee will be set up to work with the authority on the project, along with a dedicated team led by the associated policy bureau.

Ms Cheng also emphasised the need for long-term planning for the airport, as air traffic last year already reached the forecast demand for 2013, as stated in the Master Plan 2030.

In response to the government announcement, Hong Kong Air Cargo Terminals Limited (Hactl), the major air cargo handler at the airport, has strongly welcomed the decision to build a third runway at the airport.

Hactl invested US$1 billion in the construction of its SuperTerminal 1 facility at the new airport in 1998 and now handles 70 per cent of general air cargo movement in Hong Kong. It said in a statement that its annual cargo throughput (three million tonnes) already exceeds SuperTerminal 1's original design capacity.

Hactl managing director Mark Whitehead said: "The global air freight market, and the market in this region in particular, is expected to grow in leaps and bounds in the next two decades. HKIA needs to grow to meet the increases in volumes, otherwise its status as the world's No 1 air cargo hub will be under threat."

Mr Whitehead said that the third runway at the airport would mean "airlines will have the room they need to grow here, bringing jobs and prosperity. The density of aircraft movements can be maintained at safe levels, and the avoidance of air traffic congestion will reduce the impact on the environment."

Hong Kong's Cathay Pacific has also praised the government's decision. "We firmly believe the third runway is of critical importance to the sustainability of the Hong Kong economy and, therefore, to the long-term prosperity and well-being of Hong Kong's people. Connectivity with the rest of the world has made Hong Kong what it is today so we must be clear on how we can maintain and grow these links to our future," said Cathay's CEO, John Slosar.

The airline has been making significant investments at its Hong Kong hub, including more than 90 new aircraft on order for delivery up to the end of the decade with a list price of HK$190 billion, a HK$5.7 billion cargo terminal that is scheduled to open in early 2013 and more than HK$3 billion on new products in the air and on the ground.

Sister airline Dragonair's CEO Patrick Yeung agreed: "We believe that Hong Kong as a whole will benefit from the enhanced capacity in our home hub, further boosting the development of the aviation industry which makes such a significant contribution to the city's economy."

Source Shipping Gazette - Daily Shipping News

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