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Brisbane's Go Between meets targets, Clem7 losing money

, On Tuesday 23 November 2010, 10:21 EST

The Brisbane City Council says the Go Between toll bridge in the city's CBD has reached its traffic target six weeks ahead of schedule.

Last week, the bridge averaged almost 13,000 trips each weekday, which is in line with end of year forecasts.

Meanwhile, the company operating the Clem7 tunnel announced yesterday that administrators may have to be appointed by the end of the year because it is losing $7 million a month, since it opened in March.

Lord Mayor Campbell Newman says the Clem7 tunnel has helped to reduce traffic congestion.

"It is delivering great benefits to the city but it isn't a commercial success," he said.

"The great thing about the Go Between bridge is that is a commercial success as well as delivering on traffic congestion."

Rivercity Motorway Group (RMG), the operator of the Clem7 tunnel, told shareholders yesterday at its annual unit holder meeting that it expects its cash reserves of about $86 million will run out by September next year.

Shareholders heard a lack of road traffic growth on river crossings and Brisbane motorists' reluctance to pay tolls has been responsible for a revenue shortfall.

RMG director Bob Morris told shareholders the group's capital position is unsustainable and the only option to preserve the position of unit holders is for it to enter into a standstill agreement with its banks for the next two years.

Mr Morris told the meeting this would provide "breathing space" and enable the board and management to optimise the group's performance and value.

He says by then the Airport Link tunnel will be open and traffic will increase.

"That connects us out to the airport, frees-up certain congested roads," he said.

"The full opportunities and the benefits of Clem7 can start to be appreciated."

Mr Morris says if that arrangement is not reached by the end of next month, an administrator and receiver will have to be appointed.

The company is also hoping to raise revenue by selling a parcel of land and erecting several billboards along the road.

Mr Morris says the company is also in discussions with banks about cutting their board of directors from seven to four.

"No doubt they will want a say, look at the particular director's CV," he said.

"Every director on the board at the moment has a lot to offer this company and has offered a lot over the years, so it won't be an easy, easy choice."