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New connections

The roll-out of the National Broadband Network (NBN), since the project was announced in 2009, has been one of the most polarising infrastructure projects in Australia’s history.

The largest project of its kind to date, it was announced during one of the most contentious periods in history for Australian politics. Since the project commenced, the Australian Government has undergone several leadership changes, a new company was formed to administer the NBN project, an original deadline for completion was missed, and now it is expected it will still take another two years and cost $A73 billion to complete.

For those in the civil construction industry, the past few months have seen several exciting developments announced for the NBN roll-out, including a major announcement from one of the principle contractors requiring Trenchless Technology, with the future looking brighter (and faster!) than ever before for this once plagued infrastructure roll-out.

Trenchless contractors sought

As NBN Co moves forward with a new focus on engaging the most suited technology to ensure the NBN roll-out continues positively, it was announced in October 2014 that expressions of interest were being sought from trenchless contractors to assist with laying conduit as part of the NBN project.

Exel Galaxy is one of the principal contractors working on NBN Co’s Bulk Drop project nationally and is currently completing work in Victoria, South Australia and Queensland. The national project announced that they were requiring civil works to lay the conduit for the fibre cable.

The company was seeking to appoint civil crews to undertake bulk drops, which included the installation of fibre optic cable from multiport (an underground pit in the street) to end user premise (residential households).

Typically, the civil crews were requested to be involved in the following works;

  • Digging 300 mm deep x minimum
  • 100 mm wide trench on customer’s front yard
  • Install 25 mm lead in conduit
  • Backfill trench
  • Install fibre cable in conduit
  • Terminate cable.

Exel Galaxy promotes the use of non-destructive digging (NDD) technology and announced in October that awarding preference would be given to contractors proposing to use trenchless methods such as the use of vacuum excavating, hydro-vacuum excavating or vacuum trucks.

The company was looking to partner with appropriately skilled contractors to undertake a minimum 50 civil lead in conduits per week in areas such as:

  • South Australia – McLaren Vale, McLaren Flats, Seaford Falls, Aldinga Beach
  • Queensland – Brisbane, Townsville, Cairns, Mackay
  • Victoria – Shepparton, Brunswick, Carlton, Melton.

The emphasis on Trenchless Technology contractors being sought as part of the NBN’s rollout means the project continues to enter an exciting phase, where NBN Co is engaging with specifically no-dig technology, something the trenchless industry has been lobbying for since the project’s inception.

Reforms start rolling

Since coming to Government, the Coalition has implemented a series of reforms on the project, including increasing the NBN Co’s transparency and level of public reporting, appointing new management at NBN Co, and conducting a strategic review into costing and timeframes and undertaking a cost benefit analysis as well as a review of regulation to bring some rigour and renewed focus to the project.

The reforms come as a result of an external audit conducted by one of Australia’s foremost authorities on public policy, Mr Bill Scales AO, into the National Broadband Network (NBN) were announced in September 2014 by the Australian Minister of Communications Malcolm Turnbull.

The findings from the audit, which was commissioned by the current Federal Government, uncovered a series of errors in formulating the NBN policy by the previous Government, including a failure to conduct an independent, cost-benefit analysis before committing to the NBN project.

The Independent Audit of the NBN Public Policy Processes: April 2008 – May 2010 by Bill Scales contains seven key recommendations that aim to assist future Governments in devising and implementing major infrastructure projects, similar to the NBN, and to avoid the missteps of the past which have been highly profiled within the Australian media landscape over the last few years.

The Government has committed to conducting independent cost-benefit analyses on infrastructure projects worth more than $A100 million. The Government has also commissioned a cost-benefit study on the NBN since the audit results were released.

Additionally, the Audit found the following issues:

  • The previous Government did not submit the NBN project to normal cabinet processes until it was “÷rubber stamped’ just hours before the policy was announced;
  • The NBN policy was reconstituted – modelling on preliminary costs, devising funding structures and deciding on a wholly Government-owned monopoly to deliver the project during a “÷chaotic’ eleven week period in early 2009;
  • There was a reliance on what has now been uncovered as “÷flawed’ advice, including information from agencies who did not have the relevant technical or industry expertise;
  • The Government did not release a formal “÷Statement of Expectations’ document to the company until
  • 16 months after the appointment of the Executive Chairman. Some involved with the project complained that all they had in terms of guidance was the press release and a “÷bunch of business cards’;
  • Senior members of the public service found they had difficulty in having their “÷voice’ heard or the ability to provide feedback on many of the most important public policy matters related to the then-Government’s NBN policy.

Most crucially the Audit also found that NBN Co, which was established on 9 April 2009 to design, build and operate the NBN, was not fit for its purpose at the time.

The Audit argued that the company given this responsibility should have been a large and well-established telecommunications company which would have been able to undertake the works in the allotted timeframe.

The governance arrangements that operated during the very early stages of NBN Co’s life had a long lasting and detrimental effect on its operations and a profound effect on the roll out of Australia’s NBN. However, there is renewed optimism that with the reforms will come more transparency and a more efficient roll-out for all parties invested in the project.

Signed and sealed

In September 2014 it was announced that the NBN Co had signed a new service agreement with Australian company Universal Communications Group Limited (UCG) to connect
single-dwelling units to the NBN fibre network in Tasmania, New South Wales and the Australian Capital Territory.

These connections will be performed as “÷bulk drops’- which consist of connecting the fibre optic cables that have already been installed in the street to the wall of the premise.

UCG has been connecting multi-dwelling units to the NBN directly for NBN Co since 2012. The contract further cements UCG’s relationship with the Australian NBN Co.

UCG Chief Executive Officer Ralf Luna said at the time that the new contract promotes job growth within the civil construction industry.

“The new contract extends UCG’s capability to single-dwelling units predominantly private households.

“We are particularly proud of our Tasmanian operations. We’ve been active in the state since 1995 and this new contract will allow us to more than double our workforce from the current number of around 105 by employing local people and engaging local businesses,” he said.

NBN revenue and growth

During October 2014 it was announced by NBN Co Chief Executive Officer Bill Morrow that the 2015 financial year first quarter financial results had uncovered a steady growth of serviceable premises, active end-users and revenue since 30 June 2014.

The promising results following a rocky couple of years for the company included:

  • Serviceable homes grew 16 per cent over the quarter to c.640,000
  • End users grew 27 per cent over the quarter to c.267,000
  • Revenue grew 32 per cent over the quarter to $A29 million
  • Several advancements in the multi-technology mix

It was announced that the number of serviceable homes rose 16 per cent in the quarter to 640,000 – more than double the figure for the corresponding quarter last year.

This in turn helped deliver revenue of $A29 million – up 32 per cent for the quarter and triple what it was a year ago (Q1-14: $A9m).

Mr Morrow said it was a renewed focus and plan for the construction and roll-out of the project that allowed for these numbers.

“These results reflect the improvements we are making in construction, product development and the end user experience.

“They represent solid progress towards our FY15 targets of 1 million serviceable homes and 480,000 end users,” he said.

Mr Morrow also said the move towards the new roll-out model, which pushed towards a multi-technology mix and aims to connect 8 million homes and deliver
$A4 billion in revenues by 2020 – was still gathering momentum.

“The steps we’re taking to deliver the multi-technology mix will put us in the best possible position to start delivering exponential growth in the pace of the roll-out and our revenues,” he said.

The company has established a new internal group to lead the integration of Hybrid Fibre Coaxial (HFC) cables into the NBN. Existing HFC assets already pass more than 3 million homes.

Moving forward

As the NBN roll-out continues to pick up pace, it looks set to be an exciting time within the Trenchless Technology industry.

With a reliance on methods such as horizontal directional drilling, underground cable installation and vacuum excavation already being announced by principal contractors across the nation, it looks like the first few rocky years of the project are well and truly behind us.

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