MainTrain contract

In April 1993, RailCorp (then State Rail Authority) entered into a 10-year contract with United Group Rail Services (then known as A Goninan & Co) and Clyde Maintenance Facilities for the provision of train maintenance facilities at Auburn in Sydney’s west. The MainTrain facility commenced operations the following year.

In 2003, the contract was extended for five years to 2009.

Second contract extension

CityRail train undergoing maintenance On 19 February 2009, it was agreed that the contract be extended a further 27 months (Second Contract Extension).

Contract overview

Contractor
United Group Rail Services Limited (UGL Rail)
ABN 58 000 003 136
Manchester Road, Auburn, NSW.

Term of contract
The term of the Second Contract Extension commenced on 1 April 2009 and expires on 30 June 2011, unless extended. RailCorp may extend the term of the Second Contract Extension for up to three further one-year periods.

Services
UGL Rail is to provide train maintenance services at the MainTrain Maintenance Facility in Auburn.

Payments
RailCorp will make service payments to UGL Rail under the Second Contract Extension comprising:

an annual sum; and
payments for services provided in accordance with a schedule of rates

It is estimated that the total amount payable to UGL Rail over the term of the Second Contract Extension (assuming no further extensions) will be in the order of $500 million (excluding GST and including allowance for rise and fall contingency).

Payment adjustments
The service payments to UGL Rail under the Second Contract Extension will vary depending on the services which RailCorp requires. services payments can also be adjusted for various reasons including:

rise and fall
import charges
foreign exchange hedging costs
changes to the services
productivity levels
performance against agreed key performance indicators.

Asset transfers
RailCorp will continue to lease the MainTrain Maintenance Facility to UGL Rail at nominal rental for the term of the Second Contract Extension.

Risk transfer
UGL Rail bears the risk of increases in the cost of providing the train maintenance services, subject to the agreed mechanisms for adjusting services payments. UGL bears the risk of loss or damage to the trains while they are being maintained by UGL Rail.

UGL must operate the maintenance facility so that it has the capacity to provide a minimum level of services to RailCorp at all times. In return, RailCorp must provide to UGL Rail a minimum workload under the contract.

Guarantees
UGL Rail's obligations under the contract are guaranteed by United Group Limited.

Downloads

PDF file MainTrain Contract - Second Contract Extension (PDF, 7.54MB)