The MTR Corporation and its public-private partnership have initialled a concession agreement for Beijing Metro Line Four with the municipal government. MTR Chief Executive Officer CK Chow said the agreement marks an important milestone for the company's participation in Mainland metro development.

Secretary for Environment, Transport & Works Dr Sarah Liao said the investment signifies the introduction of the Hong Kong brand into the nation's capital.

The partnership project company will soon seek tenders for the provision of trains and related electrical and mechanical systems, as well as the preparation work for the operation and management of the new line.

The agreement has a term of 30 years with a total investment of 15.3 billion yuan, 70% of which will be funded by the Beijing Municipal Government.

Big investment

The project company, with a registered capital of 1.5 billion yuan, will invest five billion yuan. Both the MTRC and the municipal government will each own 49% of the joint venture company whilst Beijing Infrastructure Investment will own 2%.

Two-thirds of the investment of the project company is expected to be funded by non-recourse bank loans. The equity investment by the MTRC will be 735 million yuan.

The land acquisition and civil works construction is being conducted by Beijing Infrastructure Investment on behalf of the municipal government. Civil works started in October 2003.

The 29-kilometre underground line runs from Ma Jia Lou Station on the South Fourth Ring Road to the northwest Hai Dian District and terminates at Long Bei Cun Station.