High-Speed Expressway Project from Huu Nghi to Chi Lang
The Huu Nghi – Chi Lang Expressway Project is being developed through a public-private partnership (PPP) and a BOT contract structure. The Lang Son Provincial People’s Committee serves as the State authority for the project, which has a total investment value of 11,024 billion VND.
State budget contribution to the project: 5,495 billion VND (3,500 billion VND from the Central Government and 2,000 billion VND from the local budget).
Investor funding: 5,529 billion VND.
Groundbreaking ceremony for the Huu Nghi – Chi Lang Expressway
The value of State capital supporting the construction of the project (excluding the costs of the competent authority, contracting authority, inviting bidders, evaluation council, entrusted appraisal unit, and compensation and land clearance costs) is 3,719 billion VND. The project is expected to be completed in 2026, with a toll collection and operation period of 25 years and 8 months.
The Huu Nghi – Chi Lang Expressway Project, implemented under the PPP method and a BOT contract, will cover the Chi Lang, Cao Loc, Van Lang, and Lang Son City districts. The total length of the expressway is 60 km. It includes the Huu Nghi – Chi Lang section, which is 43 km long and has four lanes with a road width of 17m; and the Tan Thanh – Coc Nam connection section, which is 17 km long and has two lanes with a road width of 14.5m.
The completion of the Huu Nghi – Chi Lang Expressway will help reduce traffic accidents and congestion at the intersection of the Bac Giang – Lang Son Expressway and National Highway 1.
This expressway will be the initial section of the Northern High-Speed Expressway. When operational, it will connect with the Bac Giang – Lang Son Expressway and the Dong Dang – Tra Linh Expressway, which are under construction. This will contribute to the development of a comprehensive expressway network connecting major border crossings in the north to key economic centers nationwide, thereby fostering international trade and socioeconomic growth.
The Huu Nghi – Chi Lang Expressway Project is being developed under the PPP method and a BOT contract
According to Mr. Ho Minh Hoang, Chairman of the Deo Ca Group’s Board of Directors, the Bac Giang – Lang Son Expressway BOT Project was completed and put into operation in 2019. However, the project continues to face ongoing financial challenges as State budget funds have not yet been secured. This, coupled with external factors such as toll station closures and price reductions, has led to very low actual revenue, currently only about 32% of the original PATC. The bank providing the loan has suspended disbursements. These factors have created significant difficulties for the investors and contractors involved in the project.
The implementation of the Huu Nghi – Chi Lang Expressway Project is of great significance. Its completion will help address the traffic volume and low revenue challenges of the current “truncated” Bac Giang – Lang Son Expressway. It will also serve as a basis for all parties involved in PPP projects to recognize their responsibilities and remain steadfast in their commitment to resolving challenges.
When the project was on the verge of stalling, on January 16, 2023, during a meeting with the leaders of Cao Bang Province, the Prime Minister instructed that work resume immediately with Lang Son Province to expedite the implementation of the Huu Nghi – Chi Lang Expressway Project. This demonstrates that even for complex PPP investment projects, resolute leadership from the Party and State, commitment from local governments, and unwavering public support can ensure that “every difficulty will be overcome, and every task will be accomplished,” as said by President Ho Chi Minh.
Deo Ca Group’s leaders stated, “To reach the groundbreaking milestone for this project, we have overcome numerous obstacles, and there will be more challenges ahead. However, Deo Ca Group and the joint venture partners pledge to the government and the people that we will carry out the project with the spirit of ‘perseverance through sun and rain’ and ‘only forward, no retreat.’ We will transform the project site into a practical training ground not only for Deo Ca Group but also for other enterprises, enabling us to grow together as we implement innovative PPP++ investment solutions, construction management methods, and project progress and cost control technologies, such as biometric face recognition for personnel management, electronic scales for material control, and BIM technology for quality and progress management.”
Huu Nghi – Chi Lang Expressway
Earlier, on March 6, 2024, the Lang Son Provincial People’s Committee submitted a request to the Prime Minister to consider providing 5,600 billion VND from the central budget to secure the financial plan and resolve outstanding issues in the Bac Giang – Lang Son BOT project.
The completion of the Huu Nghi – Chi Lang Expressway will play a vital role in addressing the traffic volume and revenue challenges of the current “truncated” Bac Giang – Lang Son Expressway.
In April 2024, the Lang Son Provincial People’s Committee issued Decision No. 688/QD-UBND, approving the selection of the investor for the Huu Nghi – Chi Lang Expressway Project under the BOT scheme. The sole shortlisted investor was the joint venture of Deo Ca Construction Joint Stock Company, Deo Ca Group Joint Stock Company, Construction Joint Stock Company 568, and Lizen Joint Stock Company, led by Deo Ca Group. This is the same investor that successfully “rescued” the Bac Giang – Lang Son Expressway, which had been stalled for several years.
Prime Minister Pham Minh Chinh attending and giving the groundbreaking order for the Huu Nghi – Chi Lang Expressway Project
For this project, the joint venture of investors has adopted the PPP++ model, which diversifies the sources of capital for PPP investment projects.
P1++ is the State budget component, including central and local government funds.
P2++ is equity financing.
P3++ is financing raised through loans, stocks, bonds, BCC contracts, foreign sources, and secondary investors.
Under this model, the contractor also acts as a secondary investor. The project is implemented through a design-build or design-equipment supply-build contracting model to optimize investment efficiency. The profits of the contractor are reinvested into the project, aligning the contractor’s interests and responsibilities with those of the investors and tying them to the project’s implementation, operation, and performance.
In a context where numerous projects are being implemented simultaneously, posing challenges and obstacles, Deo Ca Group has adopted various solutions to enhance implementation efficiency.
Actively collaborating with training institutions to improve workers’ skills and enhance engineers’ practical and technological expertise. Utilizing training to refine models and improve the quality of management and construction for the enterprise. Recognizing each construction site as a training ground for staff and employees. Intensifying training on codes of conduct and skillsets for handling practical issues on project sites.
Applying digital technology and Building Information Modeling (BIM) to effectively monitor land acquisition, ensure transparency in design, and optimize project implementation costs.
Under the resolute leadership of the Prime Minister and the support of the Lang Son Provincial Party Committee, People’s Council, and People’s Committee, and with the successful experience in implementing the Bac Giang – Lang Son Project, the joint venture of investors
