The Hong Kong SAR Government will soon grant Heli Express the right to expand and operate the helipad on the roof of Shun Tak Building for the next 18 years, Secretary for Economic Development and Labour Stephen Ip Shu-kwan told the Legislative Council on May 2.

Tenders for the tenancy agreement were taken in January with the new agreement coming into force July 1.

Heli Express currently operates cross-border helicopter services between Hong Kong, Macau and Shenzhen, handling about 100,000 passengers a year.

Ip said the tenancy agreement is for the expansion and operation of the heliport rather than the provision of helicopter services. The main consideration in assessing the bids included the proposals for construction and operation as well as the rent offered to the government.

Ip said according to the tenancy agreement, the heliport would be open for common use by all helicopter service operators on a fair and equal basis.

The charges to be levied by the heliport operator on helicopter service operators will be non-discriminatory and subject to the approval of the Hong Kong Civil Aviation Department.

"The helicopter service fares will be be determined by individual helicopter service operators taking into account their own operating costs and market conditions," Ip said.

A government-commissioned forecast report in 2002 estimated a growth rate of 9.4 percent annually in helicopter services between 2001 and 2020, and suggested there could be an 80 percent increase in the number of movements a year to 55,200 by 2015.

As such, the government suggested in 2004 the existing heliport at Shun Tak be expanded by adding a landing/take-off pad and a connecting taxiway.

Hong Kong Polytechnic University structural engineering department associate professor Hung Wing-tat said on May 2 the potential growth for cross border helicopter services was enormous.

He said transportation time was a crucial factor, especially for business people who need to travel between Pearl River Delta cities in a very short time.

Hung said an efficient helicopter network would be able to take passengers anywhere within a 300 kilometer radius of Hong Kong within an hour, but, in order to achieve this, more heliports would have to be built throughout the territory.

Hung would not say if there was any room for a future fare adjustment.

"It's all about the relative value of time, as one minute of somebody's time could worth more than HK$100,000," Hung said.

Currently, there are three heliports in Hong Kong located in Sheung Wan, southwest Kowloon and the Hong Kong International Airport.

A site in the Kai Tak Development Area has also been reserved for a second cross-boundary heliport in the future.