PWSC(97-98)131
For discussion
on 17 February 1998

ITEM FOR PUBLIC WORKS
SUBCOMMITTEE OF FINANCE COMMITTEE

HEAD 709 - WATERWORKS
Water Supplies - Combined fresh/salt water supply projects
85WC - Service reservoir and associated waterworks to serve Kai Tak Airport early development package

Members are invited to recommend to Finance Committee -

1. the upgrading of part of 85WC, entitled "Water supply to South East Kowloon development, stage 1 - site investigation and detailed design", to Category A at an estimated cost of $30.0 million in money-of-the-day prices; and

2. the retention of the remainder of 85WC, retitled "Water supply to South East Kowloon development, stage 1 - works", in Category B.

PROBLEM

We forecast that the existing water supply systems serving East Kowloon will not be able to cope with the additional fresh water and salt water demands generated from the first phase of the South East Kowloon development in 2003. However, the Director of Water Supplies (DWS) lacks in-house resources to undertake the site investigation and the detailed design for the additional waterworks required.

PROPOSAL

2. DWS, with the support of the Secretary for Works, proposes to upgrade part of 85WC to Category A at an estimated cost of $30.0 million in money-of-the-day (MOD) prices for engaging engineering consultants to carry out the site investigation and the detailed design for the works under 85WC.

PROJECT SCOPE AND NATURE

3. The full scope of works under 85WC comprises -

1. construction of a fresh water service reservoir at Diamond Hill with a storage capacity of 76 500 cubic metres;

2. construction of a salt water pumping station next to the existing Tai Wan salt water pumping station at Tai Wan, Hung Hom with a pumping capacity of 30 000 cubic metres per day;

3. laying of about 3.4 kilometres of fresh water trunk mains of 1 000 millimetres diameter from Wang Tau Hom to the proposed fresh water service reservoir at Diamond Hill;

4. laying of about 1.2 kilometres of fresh water distribution mains of 1 200 millimetres diameter from the proposed fresh water service reservoir at Diamond Hill to the South East Kowloon development;

5. laying of about 3.0 kilometres of fresh water distribution mains of 400 millimetres diameter from Ho Man Tin and Ma Tau Wai to the South East Kowloon development; and

6. laying of about 5.4 kilometres of salt water mains of 800 millimetres diameter from the proposed Tai Wan annex salt water pumping station to the South East Kowloon development and from the South East Kowloon development to the Diamond Hill salt water service reservoir.

4. The scope of the part of 85WC we now propose to upgrade to Category A covers the site investigation works and the detailed design of the project.

JUSTIFICATION

5. After the relocation of the existing Kai Tak Airport to Chek Lap Kok, we plan to develop the Kai Tak site in phases for housing developments (the South East Kowloon development) to accommodate a population of about 310 000 upon full development. The initial phase of the South East Kowloon development will accommodate a population of about 124 000 commencing from 2003 up to 2010. The remaining phases of development will accommodate an additional population of about 186 000 by 2017.

6. DWS forecasts that the planned developments and population intake at South East Kowloon will ultimately generate additional daily fresh water and salt water demands of about 175 000 cubic metres and 49 000 cubic metres respectively when the estimated population of 310 000 is in place 2017. We anticipate that, by 2010, the water demands will reach 90 000 cubic metres and 25 000 cubic metres for fresh water and salt water respectively from the estimated population of 124 000. To meet the anticipated increases in water demand by 2010, we propose to construct a fresh water service reservoir ¹ at Diamond Hill and a salt water pumping station ² at Tai Wan. These proposed water supply systems together with the associated water mains will be able to meet the projected water demand in the area up to 2010. We will continue to plan and implement further enhancements under future projects to cope with the water demands beyond 2010 in South East Kowloon.

7. We need to start the site investigation and detailed design work by July 1998 in order to complete the proposed works under 85WC by early 2003. As DWS lacks in-house staff resources, we propose to engage engineering consultants to undertake the site investigation and the detailed design for the project.

FINANCIAL IMPLICATIONS

8. We estimate the consultants' fees for site investigation and detailed design to be $30.0 million in MOD prices (see paragraph 10 below), made up as follows -

	$ million
(a) Consultants' fees for detailed design stage	16.9
(b) Site investigation	4.5
(c) Contingencies	2.2
Sub-total	23.6	(at December 1996 prices)
(d) Inflation allowance	6.4
Total	30.0	(in MOD prices)

9. A breakdown by man months of the estimate for consultants' fees is at the Enclosure.

10. Subject to approval, we will phase the expenditure as follows -

Year	$ million (Dec 1996)	Price adjustment factor	$ million (MOD)
1998 - 99	2.0	1.16358	2.3
1999 - 2000	18.9	1.26830	24.0
2000 - 01	2.7	1.38244	3.7
	23.6		30.0

11. We derived the MOD estimates on the basis of Government's forecast of trend labour and construction prices for the period 1998 to 2001. We will award the detailed design consultancy agreement on a lump sum basis. The consultants will arrange the necessary site investigation through specialist contractors under the term contract of the Civil Engineering Department on a remeasurement basis because WSD's term contractors do not have the necessary expertise to carry out site investigation work and soil/rock testing.

12. There will be no annually recurrent expenditure arising from the project as it entails consultancy services and site investigation only.

13. The increase in water charges arising from the cost of the site investigation and the detailed design for 85WC will be negligible.

PUBLIC CONSULTATION

14. We will consult the relevant district boards during the consultancy and take into consideration the views expressed in the detailed design of the proposed works before we upgrade the construction works of 85WC to Category A by late 1999.

ENVIRONMENTAL IMPLICATIONS

15. The Director of Territory Development (DTD) has conducted an Environmental Impact Assessment (EIA) under the General Feasibility Study of South East Kowloon development which includes the proposed waterworks and service reservoir under 85WC. The Director of Environmental Protection agreed that the proposed waterworks project would have no long term adverse environmental impact and no further detailed environmental impact assessment would be required. The proposed consultancy itself will not have any environmental implications.

LAND ACQUISITION

16. The project does not require land acquisition as it comprises consultancy services and site investigation only.

BACKGROUND INFORMATION

17. In July 1996, the DTD upgraded 469CL "Kai Tak Airport early development" to Category B under Head 707. In March 1997, DTD and DWS agreed to remove from 469CL the proposed works that provide water supply to the proposed developments in South East Kowloon and to implement it separately in 85WC under Head 709.

18. In April 1995, the Finance Committee approved the upgrading of 440CL "South East Kowloon Development Feasibility Study" to Category A under Head 707 for engaging consultants to carry out the feasibility study for the South East Kowloon development project which also included the preliminary design for the proposed waterworks under 85WC. The consultants completed the study and recommended the outline design for the principal elements of the proposed waterworks under 85WC in December 1997.

19. We plan to commence the site investigation and the detailed design for this project in July 1998 for completion in December 1999 and to upgrade the construction works of 85WC to Category A immediately thereafter with a view to complete the works by early 2003.

Works Bureau
February 1998

(LL307)

1.The storage capacity of the new fresh water service reservoir described in paragraph 3(a) is generally lower than the daily fresh water demand because replenishment will come from the water treatment works supply source as the stock in the service reservoir is depleted during the course of the day.

2. The pumping capacity of the salt water pumps described in paragraph 3(b) is generally higher than the daily salt water demand because it has to cater for the peak demands during the day.

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Enclosure to PWSC(97-98)131

85WC - Service reservoir and associated waterworks to serve Kai Tak Airport early development package

DETAILS OF CONSULTANTS' FEES

Breakdown of estimates for consultants' fees

Consultants' staff costs		Estimated man months	Average MPS* salary point	Multiplier factor	Estimated fee ($ million)
(a) Detailed design stage including supervision of site investigation works	Professional Technical	65 65	40 16	3.0 3.0	10.8 3.6
(b) Preparation of tender document	Professional Technical	6 12	40 16	3.0 3.0	1.0 0.7
(c) Tender assessment	Professional Technical	3 6	40 16	3.0 3.0	0.5 0.3
		Total consultants' staff cost			16.9

* MPS = Master Pay Scale

Notes

1. A multiplier factor of 3 is applied to the average MPS point to arrive at the full staff cost including the Consultants' overheads and profit, as the staff will be employed in the Consultants' offices. (At 1.4.96, MPS pt. 40 = $55,390 p.m. and MPS pt. 16 = $18,595 p.m.)

2. The figures given above are based on estimates prepared by the Director of Water Supplies. We will only know the actual consultants' fees when we have selected the consultant through the usual competitive bidding system.

(LL307)