March 23, 2018 / 1:28 PM / a month ago

China interested in eventual bid for Sweden-Denmark tunnel project

March 23 (Reuters) - State-controlled China Railway Group (CRG) is preparing an eventual bid for the construction of a $5.6 billion tunnel between Sweden and Denmark, according to Swedish municipal authorities.

The six-kilometre tunnel - known as HH-tunnel - has yet to be finally approved by Sweden and Denmark. The bidding process wouldn’t begin for another few years, but CRG is due to publish a report next week on how the tunnel should be built, Swedish authorities said.

Swedish construction company Skanska is among other firms expected to bid for the project.

CRG’s interest comes as China is pursuing its massive Belt and Road Initiative, a modern-day “Silk Road” that aims to connect China to Europe, the Middle East and beyond via infrastructure projects across dozens of countries.

The proposed tunnel linking the Danish town of Helsingor to Helsingborg in southern Sweden would be the largest project undertaken by a Chinese company in Scandinavia so far.

Representatives of China Railway Tunnel Group, a unit of CRG, have met with Helsingborg authorities three times since November expressing an interest in the project, Helsingborg Municipality said.

“We gave them some prerequisites from previous reports we had made about the HH tunnel. They have looked into it and suggested how they would do it,” Angelica Nilsson, infrastructure planning director at Helsingborg Municipality, told Reuters.

CRG did not respond to queries from Reuters about its interest in the project. Officials in Denmark’s Ministry of Transport and Helsingor Municipality said they were unaware of any interest from the Chinese company.

Chinese investors in January cancelled plans to build a large deep water port in Sweden, citing local residents’ environmental and security concerns about the project.

The Danish and Swedish authorities, who are working on a strategic analysis on the tunnel and estimate its cost at 34 billion Danish crowns ($5.6 billion), sought funding for the project last month from the EU structural fund Interreg, according to Denmark’s Ministry of Transport. ($1 = 6.0434 Danish crowns) ($1 = 6.0334 Danish crowns) (Reporting by Emil Gjerding Nielson; Editing by Jacob Gronholt-Pedersen and Susan Fenton)

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