An economic feasibility study for a railway network linking Tripoli to Beirut

Abstract

Due to the increasing population and number of cars, Lebanon is facing a major traffic congestion problem, not to mention the pollution all the vehicles are emitting. Along the Tripoli-Beirut highway, the Lebanese are facing a yearly cost of around {dollar}284 million due to the excess in traffic, around {dollar}260 million due to the car accidents, {dollar}8.5 million due to road maintenance, and an average of {dollar}18 million due to vehicle pollution. A railway transportation network for passenger purpose will benefit Lebanon economically and environmentally. The main problem facing the Lebanese government is the lack of studies for public transportation. The main objective of this paper is to perform an economic feasibility study of a railway network linking Tripoli to Beirut.The paper considers two alternatives: (1) an underground metro line below the old tracks location, with metro trains, stations, and additional stops (Alternative 1); and (2) an aboveground railway line along the old track locations, with new trains, tracks, stations, and additional stops (Alternative 2). The economic study uses the Benefit to Cost (B/C) Ratioapplied in order to evaluate the two alternatives. Hence, benefits and costs are estimated for each alternative for a project life of 25 years, and a discount rate of 6%.The economic evaluation advised that both alternatives are feasible, however Alternative 2 is preferred and more profitable. Uncertainties in costs, benefits, and discount rate are estimated and sensitivity to the decision is evaluated using Sensitivity Analysis technique and @RISK Software. It is observed that changes of ± 40% in the Benefits significantly change the B/C ratio, while the decision of Alternative 2 remains. This study is relevant to the Lebanese government and can be used as a generic procedure for governmental projects worldwide.