{"id":9750,"date":"2026-05-12T07:30:12","date_gmt":"2026-05-12T07:30:12","guid":{"rendered":"https:\/\/www.europesays.com\/australia\/9750\/"},"modified":"2026-05-12T07:30:12","modified_gmt":"2026-05-12T07:30:12","slug":"bungled-spirit-of-tasmania-ferry-replacement-project-has-cost-717-million-more-than-first-forecast","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/australia\/9750\/","title":{"rendered":"Bungled Spirit of Tasmania ferry replacement project has cost $717 million more than first forecast"},"content":{"rendered":"

The bungled Spirit of Tasmania ferry replacement program has cost $717 million more than was forecast in the original business case, a parliamentary inquiry has heard.<\/p>\n

The Public Accounts Committee on Tuesday held its latest hearing into the status of the delayed and over-budget project, which began in 2018.<\/p>\n

The bulk of the total cost overrun relates to the new berth facilities at Devonport.<\/p>\n

\"Workers<\/p>\n

The final piece of the new gantry has officially been put into place at the Berth 3 facility in Devonport.\u00a0 (Supplied: Tasmanian government)<\/p>\n

Originally estimated at $90 million, the new facilities have a revised budget of $493 million \u2014 an increase of $403 million.<\/p>\n

This includes $9 million spent on hull strengthening and fender remediation.<\/p>\n

The cost overrun also includes about $280 million extra on the two new vessels \u2014 Spirit 4 and Spirit 5 \u2014 which were built in Finland by RMC.<\/p>\n

\"Aerial<\/p>\n

Berth 3 is under construction in Devonport, to home the new Spirit of Tasmania ships. (Supplied: Tasmanian government)<\/p>\n

The additional costs are associated with a change in shipbuilder, a contract adjustment, a Russia-Ukraine war adjustment and support for the shipbuilder.<\/p>\n

“We believe the total vessel replacement and the two berths have an overrun of about $717 million,” the chairman of ferry operator TT-Line, Ken Kanofski, said.<\/p>\n

Devonport Terminal 3\u00a0Original estimate$90 millionRevised budget$493 millionCost overrun$403 millionFerry replacement\u00a0Change of shipbuilder\u20ac82 millionContract adjustment\u20ac25 millionRussia-Ukraine war adjustment\u20ac8 millionShipbuilder support\u20ac50 millionCost overrun\u20ac166 million ($AU280 million)Geelong terminal\u00a0Scope changes$34 millionTotal cost overrun$717 million<\/p>\n

The $717 million figure only relates to capital costs.<\/p>\n

It does not include the cost of berthing both vessels for many months in Scotland and Victoria while their Devonport facility are constructed.<\/p>\n

\"Crane<\/p>\n

The fitout of the new gantry at Devonport port is currently underway. (Supplied: Tasmanian government)<\/p>\n

Mr Kanofski said monthly berthing costs ranged from $600,000 in Scotland to $900,000 at Geelong, but he did not provide the committee with the total cost incurred.<\/p>\n

He said both ships were on track to begin carrying passengers and freight across Bass Strait from the end of October.<\/p>\n

The two existing ships, which have a book value of about $50 million each, have been listed for sale.<\/p>\n

TT-Line’s growing debt<\/p>\n

TT-Line’s finances have been the subject of ongoing scrutiny after the state’s auditor-general last year formed the view the government-owned company had become insolvent in July.<\/p>\n

In last year’s state budget, the company was given a $75 million equity injection and had its debt capacity increased from $990 million to $1.4 billion.<\/p>\n

The company disputes that it was ever insolvent.<\/p>\n

\"A<\/p>\n

The delivery of the new ships has been hampered by delays and cost blowouts. (Supplied: David Wallace)<\/p>\n

At Tuesday’s hearing, Mr Kanofski was asked by Labor’s Treasury spokesman Dean Winter to describe the company’s financial position.<\/p>\n

“I would describe the current financial position as very challenging,” Mr Kanofski replied.<\/p>\n

“Obviously, we’ve inherited a position where because of delays in the berthing project in particular, we’re in a situation where we’re running four vessels.<\/p>\n

“And \u2026 it’s a lot in terms of the cost of running four vessels when only two of them are revenue-generating.”<\/p>\n

Mr Kanofski noted the company was carrying a “substantial” amount of debt and that its interest repayments were “quite high”.<\/p>\n

“I’ll stress that at all times, TT-Line has been able to pay its debts as and when they fall due,” he said.<\/p>\n

“That has always been the case, and it remains the case today.”<\/p>\n

\"Sleek<\/p>\n

The new ships are expected to start operating in October. (ABC News: Monty Jacka)<\/p>\n

Mr Winter asked him to outline what kind of support TT-Line had requested from the government ahead of next week’s state budget.<\/p>\n

Mr Kanofski declined to reveal the details, citing cabinet confidentiality.<\/p>\n

“What I can say to you is we’ve put forward a set of financials and a set of recommendations to the government that would see the business operating in a sustainable way,” he said.<\/p>\n

The details are expected to be outlined when the budget is delivered on May 21.<\/p>\n","protected":false},"excerpt":{"rendered":"The bungled Spirit of Tasmania ferry replacement program has cost $717 million more than was forecast in the…\n","protected":false},"author":2,"featured_media":9751,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[22,21,10944,3220,3139,10945,10943,5951,5247,10942],"class_list":["post-9750","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-austrlia","tag-bailout","tag-budget","tag-funding","tag-management","tag-spirit-of-tasmania","tag-tas","tag-tasmania","tag-tt-line"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts\/9750","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/comments?post=9750"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts\/9750\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/media\/9751"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/media?parent=9750"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/categories?post=9750"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/tags?post=9750"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}