The Victorian Government has leased the Port of Melbourne for more than $9.7 billion to a consortium that will manage the port’s commercial operations for the next 50 years.

The lease was sold to Lonsdale Consortium which comprises the Future Fund, QIC, GIP and OMERS.

The lease proceeds will go towards the Victorian Transport Fund and be used for projects including the removal of 50 of the most dangerous and congested level crossings in the state.

The fund will also be used to build the Melbourne Metro, the Western Distributor and support projects which can reduce traffic congestion and facilitate access to the port.

Ten per cent of lease proceeds will be invested in regional and rural infrastructure projects, totalling more than $970 million.

Victorian Premier, Daniel Andrews, said the deal was a vote of confidence in the Victorian economy.

“We promised to lease the port, get rid of Victoria’s most deadly and congested level crossings and create thousands of jobs, and that’s exactly what we are doing.”

A new $200 million Agriculture Infrastructure and Jobs Fund has also been established to drive economic growth in our regions, boost exports and support Victorian farmers from paddock to port.

The Victorian Government will work with the Commonwealth to finalise the additional 15 per cent that the state is entitled to under the Commonwealth’s asset recycling initiative.

“The strength of this result underlines the continued high performance of the Victorian economy – the fastest growing in the country,” Victorian Treasurer Tim Pallas said.

“Leasing the port reinforces Victoria’s position as the freight and logistics capital of Australia and will make a great port even better.”

The state will retain responsibility for the Harbour Master, Station Pier, relevant safety and environmental regulation, waterside emergency management and marine pollution response.

Victorian Minister for Ports and Acting Minister for Regional Development Luke Donnellan said, “Through this lease, we are supporting our state’s vibrant regional communities, putting infrastructure and agriculture back at the heart of Victoria’s economic development.”

Chairman Port of Melbourne Corporation Mark Birrell said, “This is a great result for Australia’s largest maritime trade hub and reflects the port’s vital role in the state and national economies.”

During the lease term, Lonsdale will maintain access to public walkways and bike paths for community use.

Commercial and recreational vessels’ access will not be affected by the lease, with the port being returned to public hands at the end of the lease.

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