Rail Baltic Estonia, the company in charge of the Estonian section of the major European rail project, said that there is still a 70-80-percent chance the Tallinn-Pärnu train connection will be created by 2030. The likelihood of extending the railroad from Pärnu to Riga by the turn of the decade is somewhat smaller.
The Estonian Consumer Protection and Technical Regulatory Authority (TTJA) issued the first building permit for the Rail Baltica project's main route last Friday. The 9.4-kilometer section in question is currently in the tender phase and work on the embankment and the track bed is set to begin next year. So far, various animal crossings and overpasses have been built in different parts of Estonia.
The date of completion for the Estonian part of the megaproject has been postponed to 2030 and its estimated cost has grown to €1.8 billion. However, it is not yet certain we will see fast trains in Estonia by then.
Anvar Salomets, CEO of Rail Baltic Estonia, said that the technical side is easy as construction work usually goes more or less to plan, while the number one question is when it can start.
Salomets said that while the main bottleneck of design work is becoming less of an issue, projects are still not being completed as quickly as the initial time frame prescribed.
"It is a matter of output. The bottleneck has been cleared but not completely. But at least we can have a plan, pursue sensible risk management and agree on things inside the joint venture," Salumets said.
Even though the main route will be divided into sections going into tenders, all need to be finished before the top infrastructure work starts. It makes little financial sense to lay a few kilometers of tracks at a time. Therefore, if the top infrastructure will take two years to construct, the rest of the work needs to be completed by 2027 if deadlines are to be honored.
The CEO said that Latvia and Lithuania have no bigger risks than Estonia, which is why it is less likely there will be problems on their end. However, project financing could still potentially pose problems.
The EU funding round will end in 2027, and it is likely that funding volumes will fall just when Rail Baltica's need for cash is greatest. The biggest costs are forecast for 2025-2028 when projects in Estonia alone will require over €300 million a year.
Should it prove impossible to source the necessary sums from the EU during those years, the project's completion could be postponed due to lack of funds.
"To put it very simply, a state company cannot commit to transactions if corresponding funding decisions have not been made. Should those [funding] rounds yield less financing, we can dial back transactions and simply construct fewer kilometers of tracks. It does not mean suspending construction, while we may be forced to reduce volumes."
While several risks remain, Salomets believes there is a 70-80-percent chance it will be possible to travel from Tallinn to Pärnu by train in 2030.
Things are somewhat different for Pärnu County. Because environmental impact assessments have taken longer than planned in the southern part of the county, the construction phase might get dragged out as well.
Salomets said risks associated with the planning time frame are greater than those of construction and financing for the southern part of the route. The Rail Baltic Estonia CEO said that if construction cannot be launched by 2025, the part of the railroad from Pärnu to Riga just cannot be completed by 2030.
Editor: Marcus Turovski