Branson in talks to save Tunnel rail link

Richard Branson's Virgin group is in talks with Railtrack and the US construction company Bechtel to form a new consortium to salvage the Channel Tunnel rail link. Michael Harrison examines the proposal.

Under the revised scheme, construction of the 68-mile link from the Kent coast into central London would be left to Railtrack and Bechtel while Virgin would run the Eurostar train service.

Virgin and Bechtel are members of the discredited London & Continental Railways consortium which collapsed two weeks ago after the Government refused to provide an additional pounds 1.2bn on top of the pounds 1.8bn subsidy already granted to build the link. However, Virgin had already withdrawn in all but name.

Bechtel is credited with getting construction of the Channel Tunnel itself back on track after it was brought in by Eurotunnel to manage the project and liaise with the contractors Transmanche Link. Railtrack and Virgin executives are to hold further talks this week about a joint approach to the Government.

The Railtrack board meets on Thursday to review progress and examine options for financing and building the link.

Potential rival Eurorail, a consortium of construction companies and banks which lost out to LCR in the bidding for the link in 1996, is due to set out its new proposals for taking over the scheme tomorrow or Wednesday.

One possibility Railtrack is considering is building the link in phases. It has been designed to end at a new terminus at St Pancras but this would involve 12 miles of expensive tunnelling under central London.

An alternative is to end the high-speed line at Ebbsfleet in north Kent and then continue on existing track to the terminus at Waterloo International .

A spokesman said: "This would be a lot cheaper than doing the fully-fledged link in one year. As income starts to flow in from customers using the first stage we could build the revenue to continue developing the line further."

A group of MPs representing constituencies in East London and Kent will today table a Commons motion urging the Government to press ahead with the rail link, arguing that thousands of jobs and commuter services will be at risk if the project is scrapped.