While construction of the temporary control line between Estonia and Russia is progressing as planned, the state will have to take increases in construction costs into account when building out successive stages of the border. The price of delay fencing alone has doubled, and procurement thereof has gotten increasingly difficult.
The first, 23.5-kilometer section of the control line, which runs from the point where the Russian, Latvian and Estonian borders meet through Luhamaa, is essentially finished, and the builder intends to hand it over to the state early this summer – nearly a year ahead of its contractual deadline.
“Favorable weather conditions, which allow for faster construction, have granted us the opportunity to move forward quickly with border construction,” said Egert Belitsev, deputy director general for border management at the Police and Border Guard Board (PPA). “The next stage of construction is already underway, which is nearly 40 kilometers in length.”
How much border construction will cost moving forward, however, no one can say.
“In addition to price increases, another nuance affecting this second contract is the fact that there is enormous competition for fencing material in our region,” Merko Ehitus Eesti project manager Tarmo Sinisaar said. “Our good neighbors Latvia, Poland and Lithuania are likewise building fences at breakneck speed, and this resource is fairly limited already.”
According to Sinisaar, delay fencing has doubled in price, and delivery times have lengthened considerably as well. On top of that, the price of geosynthetics has soared by nearly 70%, road and construction materials by 30% and fuel by 50%.
The increase in fuel prices alone could drive up the cost of further border construction by 20-30%.
“Of course increased steel prices and increased oil prices affect us, as our steel volumes are enormous and everything in the world and in construction is connected to oil prices,” he noted.
“All contracts include a force majeure clause,” Belitsev said. “Currently we have no indications on that front that we should seek additional money from the government. But we have several different procurements underway, meaning procurements for the next stages of construction, and technology procurements. In terms of future procurements, prices may end up more expensive than we had anticipated. That, then, will require additional funding.” (ERR/Business World Magazine)
