British Steel Secures Major Railway Deal
- British Steel has secured a five-year contract worth £500 million to supply 70,000 to 80,000 metric tons of rail annually to Network Rail.
- The company recently invested £10 million to open a new rail stocking facility at its Scunthorpe plant.
- The UK Government announced a delay to the HS2 high-speed rail project due to missed deadlines and escalating costs, with an updated cost projection now at £106 billion.
British Steel has secured a 5-year agreement to supply rail to Network Rail, the infrastructure manager of the UK’s rail network. Under the tenets of the deal, the steelmaker will provide 70,000 to 80,000 metric tons per year.
In a June 17 statement, British Steel reported that the contract is worth £500 million (almost $673 million) and has an option to extend by three years.
British Steel Recently Constructed New Rail Facility
Rails supplied from British Steel’s Scunthorpe plant, in Lincolnshire, are to include HP335 grade material as well as coated rails for difficult environments, such as at level crossings, tunnels and coastal regions. The company stated that British Steel has supplied rails to the UK networks for over 20 years. Other rail products include sleepers as well as conductor rails for electric trains.
British Steel opened a rail stocking facility at Scunthorpe in November, which can hold up to 25,000 metric tons of finished rail in lengths up to 108 meters. Investments into that project totaled £10 million ($13.4 million).
UK Government Delays HS2
Meanwhile, the UK Government announced June 18 a delay on the country’s High Speed 2 (HS2) rail project, which was tentatively due to start operating by 2033, though did indicate when it would begin operating in revenue service.
Transport Secretary Heidi Alexander made the announcement in the House of Commons, the UK parliament’s lower chamber, citing missed deadlines and ballooning costs. Alexander also said that she would provide an update on costs and deadlines by year’s end.
The HS2 project originally had a cost projection of £56 billion ($75.5 billion). That was back in 2015. However, a government-commissioned review in 2019 warned that the project could reach £106 billion ($143 billion).
The original project also stipulated running the line up to Leeds and Manchester, though the previous government of Rishi Sunak cancelled them in 2021 and 2023, respectively. Alongside that move, they also truncated the line to run only as far as Birmingham.
By Christopher Rivituso
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