Ukrzaliznytsia Begins Process Of Purchasing Railcars With EBRD Funds

The process of purchasing freight gondola cars for the Ukrainian Railways joint-stock company (JSC Ukrzaliznytsia) with credit funds from the European Bank for Reconstruction and Development (EBRD) has begun. The freight gondola cars will be procured through a two-stage tender in accordance with the principles and rules of the EBRD, using the EBRD’s Client E-Procurement Portal (ECEPP).

JSC Ukrzaliznytsia announced this in a statement, the CFTS portal reports.

In total, JSC Ukrzaliznytsia plans to purchase approximately 4,500 general-purpose freight cars (with hatches) in three stages: 1,000 cars (4 lots) during the first stage in 2019, 1,500 cars (5 lots) during the second stage in 2020, and 2,000 cars (6 lots) during the third stage.

Seventy percent of the contract price (excluding VAT) will be financed with an EBRD loan and 30% by JSC Ukrzaliznytsia.

Potential participants that register in the ECEPP and show interest in the transaction will be able to obtain clarifications and additional information from JSC Ukrzaliznytsia through the ECEPP.

The first stage of the two-stage tender process will consist only of technical proposals without indication of prices. Commercial offers will be submitted in the second stage.

The company plans to meet with market participants in the near future to clarify the tender procedure.

As the CFTS portal reported, the European Bank for Reconstruction and Development and JSC Ukrzaliznytsia signed a long-term loan agreement on provision of a loan of USD 150 million for purchase of new freight gondola cars in November 2018. This loan was provided without government guarantee. According to information published by the EBRD, the loan will be used to acquire up to 6,500 general-purpose open freight gondola-type wagons through an open international tender.

As reported, CFTS Consulting conducted a detailed study of the competitiveness of various modes of transport in Ukraine in terms of cost and administrative expenditures and prepared a forecast for Ukrzaliznytsia's cargo flow until 2032 for the EBRD. The EBRD used the result of this study to assess the possibility of providing Ukrzaliznytsia the loan of USD 150 million for purchase of freight gondola cars.