The STRABAG-Equitix consortium has been named as the preferred bidder by United Utilities to design, build, finance and maintain the replacement of six tunnel sections of the Haweswater Aqueduct, part of its Haweswater Aqueduct Resilience Programme (HARP).

STRABAG UK Ltd will be responsible for the full design and construction scope of the project, while the financing will be provided by Equitix and the STRABAG Group. The estimated construction cost will be in the region of £2.5 billion to £2.9 billion.

STRABAG and Equitix have participated as joint partners in the tendering process via Ofwat’s Direct Procurement for Customers (DPC) approach for the selection of a Competitively Appointed Provider (CAP). The project company is responsible for the concession agreement with United Utilities.

This is the first time the DPC model has been used in the UK water sector. The procurement process is now in its final stage of financial close, with contract award planned for the first half of 2025, subject to consent by Ofwat. DPC involves a water or wastewater company competitively tendering for services in relation to the delivery of certain major infrastructure projects, resulting in the selection of a third-party CAP who will design, build, finance, and in some circumstances operate and/or maintain the relevant infrastructure. DPC will result in water companies competitively procuring more aspects of an infrastructure project, including financing for the project.

Neil Gillespie, Transformation and Strategic Programmes Director at United Utilities, said:

“This is a significant milestone in our journey to replace the Haweswater Aqueduct tunnels so that we can continue to provide customers in the North West with a reliable supply of quality drinking water into the future. This is the culmination of a lot of hard work from a dedicated team, and we are really pleased to have now established our preferred bidder.”

HARP is a major scheme to maintain drinking water supplies across Cumbria, Lancashire and Greater Manchester for future generations. The Haweswater Aqueduct is a 110km pipeline which runs from the Lake District, through Lancashire and into Greater Manchester.

Originally constructed in the 1950s, the pipeline needs essential upgrade work and will see the replacement of the existing tunnel sections to ensure it can continue to supply customers for generations to come.

STRABAG CEO, Klemens Haselsteiner, said:

“We are delighted to have been appointed preferred bidder on such a regionally important programme in the North-West and are looking forward to working with United Utilities. This is an exciting programme which will provide a huge amount of benefit to the region. In recent years, STRABAG UK has reached several impressive milestones on major projects and has seen consistent growth. This is an important step in our expansion plans for the UK division of STRABAG and is further recognition of our industry leading expertise.”

Equitix’s CEO, Hugh Crossley, added:

“Equitix is delighted to be selected as preferred bidder with our consortium partner STRABAG, to deliver this strategically important project for United Utilities and Ofwat. Our strong track record in delivering greenfield projects, coupled with our approach to partnerships will lead to the successful delivery of this significant project that will benefit communities in the North West for generations.”

The contract includes design and construction, finance and maintenance of six tunnel sections of the pipeline. The construction phase is planned to run over eight years followed by a further 25 years of maintenance.

The coming together of UK core infra leader Equitix and global construction leader, STRABAG, will see their respective skillsets and expertise create a new partnership. The new contract builds on the ongoing success of STRABAG in the UK, replicating the Group’s extensive international experience in providing end-to-end capability services (finance, design, construction, and fit-out) in the built environment.

STRABAG UK Ltd has been working In the UK market since 2011 and has over 1,500 employees involved in several projects in the UK, including:

• the Coire Glas Exploratory Tunnel near Fort William (for SSE Renewables)
• the Woodsmith project in North Yorkshire (being carried out on behalf of Anglo American)
• the London HS2 Tunnels (Skanska Costain STRABAG JV)
• an advanced manufacturing facility in Hartlepool.

In 2023, STRABAG UK launched a new building unit, based in Solihull, which leads on the construction of light industrial and logistics centres, data centres, advanced manufacturing facilities and commercial developments.

Equitix is a responsible investor, developer and manager of core infrastructure assets and critical services established in 2007 with over £11 billion in assets under management, invested across 350 assets in 22 countries.