AF Gruppen has been awarded the design-build contract for the Stad Ship Tunnel in Norway, following a final negotiation round with three bidders.
The Norwegian Coastal Administration (NCA) selected the contractor after tenders were submitted in April 2026 by AF Gruppen, Eiffage Génie Civil, and a consortium formed by Skanska and Vassbakk & Stol.
The contract is valued at approximately Nkr5.6bn ($564m), excluding VAT, and signing is scheduled to take place after the Norwegian summer holidays in August, following a standard standstill period.
Norwegian Coastal Administration Director General Einar Vik Arset said: “We have been fortunate to have highly skilled and committed bidders participating in this competition. The final bids were submitted in April, and following a thorough evaluation, AF was found to have submitted the best overall bid.
“We now look forward to working with an experienced Norwegian contractor to deliver this historic project.”
The Stad Ship Tunnel project involves construction of a 1,700m-long tunnel through the Stad Peninsula in Western Norway, designed to create a safer route for maritime traffic between Kjødepollen in Vanylvsfjorden and Moldefjorden near Selje.
The tunnel will be 50m high and 36m wide, allowing passage for vessels up to 16m wide and with a draft up to 12m. Including entrance and exit areas, the total tunnel length extends to approximately 2.2km.
The construction will also cover approach and guiding structures, commercial development areas at both tunnel portals, and transport of excavated rock to external disposal sites. It will further include rock support, fender systems, technical installations inside the tunnel, and dredging of the shipping channel in Saltasundet near Selje.
The project aims to improve maritime safety and reliability along one of the most exposed stretches of sea on the Norwegian coast. The Stad Peninsula is known for severe weather conditions and hazardous navigation, and the tunnel is intended to reduce risk of accidents, minimise waiting times for ships, and facilitate more efficient sea transport in storm-prone waters.
AF Gruppen CEO Amund Tøftum said: “It is rare for us, as a design and build contractor, to have the opportunity to take on such a unique infrastructure project, attracting significant local, national and international interest. We appreciate the trust placed in us by the Norwegian Coastal Administration and look forward to a strong collaboration in delivering this project.”
On 19 June, the Norwegian Parliament (Stortinget) approved a new cost framework for the project, setting the total budget at around Nkr8.6bn. In conjunction with this, the Norwegian Coastal Administration received updated assignment and allocation documentation from the Ministry of Trade, Industry and Fisheries, authorising contract signing and project initiation.
The Norwegian Revised National Budget for 2026 has allocated Nkr150m for start-up activities.
Before main construction commences, a collaboration phase will be introduced to facilitate detailed planning, resolve potential challenges, and establish working procedures. During this phase, AF Gruppen will undertake detailed design work and preparations for project execution.
Site offices, accommodation facilities, road upgrades, and temporary access routes are among the anticipated preparatory activities before tunnel excavation, which is expected to start in early 2027.
Separate contracts for water pipeline installation and building demolition linked to the tunnel’s alignment are due for tendering during the summer.
Design and engineering for the project will be led by Norconsult, working in partnership with AF Gruppen. Norconsult’s contract for this phase is valued at Nkr165m. Construction is expected to continue until 2032, at which point the Stad Ship Tunnel will offer a full-scale passage for vessel traffic along the Norwegian west coast.
