Turkey's Bayinder has submitted the lowest price for the construction of a new airport at Islamabad, industry sources say. However, potentially large variations in the content of proposals and the possibility of implementing the project on a build-operate-transfer (BOT) or similar basis, mean that an award could still go to any of the bidders, the sources say.

Bidders are understood to also include the Matrix Consortium, which groups together the local Mega & In Group, the Netherlands' Schiphol Airport and South Korea's Ssangyong, France's Bouygues and the local Habib Rafiq with a UK partner.

The groups costed the construction work on the basis of their own traffic projections, the sources say. Such projections could have varied considerably, resulting in proposals for airports with initial capacities ranging from 500,000-2 million passengers a year, the sources say. The cost of the project could vary from $375 million-500 million.

The government is expected to issue bidders with details of a BOT concession for the airport in the next few weeks. The groups would then be expected to prepare detailed BOT proposals supplementing their initial construction costings. How the concession would be structured is not yet clear. However, close observers say that the government wants a single developer to undertake all the airport's operations. The developer would be expected to pay royalties to the Civil Aviation Authority.

The government has not said whether it would provide guarantees, in terms of traffic levels. However, industry observers say that guarantees would be required in order for the developers to raise the necessary finance (MEED 12:9:97).