The IP1 fibre optic cable network project was designed to run from Perth to Melbourne (a distance in excess of 3,000 kilometres). The path of the project included some of the most inhospitable climatic conditions on earth, including travel through the Nullabor plains in outback Australia.
The technology to be used was Marconi DWDM and ultra long haul fibre optic systems SOLSTIS, which had not been previously implemented anywhere else in the world. This network was the first to implement a non repeated section from Perth to Gawler SA, a distance of over 200kms.
Consultel was engaged by major banking group ABN Amro as “independent engineers” to review the technical viability of the project. The technical viability was part of the due diligence for the project financing.
ABN acted on behalf of the senior lenders and equity providers with the project value in excess of $150 million. The lenders and financiers were providing 80% of the project value.
Consultel undertook the following Activities:
- Provided a top level review of the technical specification and performance requirements of the Network.
- Reviewed the project activities of IP1 and NDC, Marconi, Pirelli, Corning and Brand Rex (the “Suppliers”) to determine that they could comply with obligations in the project documents at the standards required to operate and manage the Network at industry best practice.
- Reviewed the construction program of works set out in the DCC and the Supply Contract.
- Provided an opinion on the ability of IP1 and the suppliers to deliver the Network on time and provide an opinion on the reasonableness of the cost to complete the Network within budget, including adequacy of contingencies.
- Commentary on the Network’s fitness for purpose.
- Provided opinion on the ability of IP1 and the suppliers to achieve completion of installation by 30 June 2002.
- Provided opinion on the adequacy of the construction milestone program.
- Provided opinion on the adequacy of the operation and maintenance budget for the operating phase of the Network.
- Provided opinion on the ability of IP1 and NDC to maintain and operate the Network and repair the Network as required.
- Highlighted and summarised any potential technical risk areas in connection with the construction or ongoing operation of the cable, together with likely risk percentages, costs to remedy and recommendations as to actions available to mitigate such risks.
Reviewed the technical inputs to the Financial Model prepared by IP1.