Robert Malpas, co-chairman of Eurotunnel, said yesterday in Folkestone: "An extension is critical if we are to secure the support of our bankers and shareholders for the financial restructuring. Without it, it will be even more difficult."
He was speaking as Eurotunnel announced that it had recaptured a third of the cross-Channel market since the freight shuttle fire in November which forced it to close the tunnel. Eurotunnel expects its market share to return to 50 per cent by the end of the year with total revenues forecast to increase to about pounds 600m compared with pounds 450m last year.
The total cost of the fire, including lost revenue, repair work, compensation payments and the replacement of the burnt-out shuttle, is forecast at a maximum of pounds 265m-pounds 270m. However, Eurotunnel said its insurance would cover it for all but pounds 5m-pounds 7m of this.
The only remaining clues to the terrifying conflagration that took place are the exposed steel reinforcing bars hanging from the tunnel roof. The sheer heat of the fire stripped away three-quarters of the 40cm thick concrete lining covering them.
Yesterday, nine weeks to the day after the blaze, work began to repair the tunnel so that it will be "as good or better than the original", according to David Pointon, Eurotunnel's technical director. A team of 140 engineers will work around the clock for the next 16 weeks to repair the lining and renew the burnt out electrical systems.
What remains of the lining will be secured with hundreds of 2.5-metre steel bolts. The engineers will then spray the tunnel walls with concrete from specially adapted trains. When the tunnel was originally built the concrete lining was fitted in giant pre-cast slabs. As a precaution, the most severely damaged part of the tunnel - a 46 metre-long section - is temporarily being supported with steel colliery arches.
The tunnel floor is, disconcertingly, a few inches deep in water and everywhere the tunnel lining is blackened by smoke. But Mr Pointon says: "We have monitored for structural movement and drilled numerous boreholes and the news is good. There is very little ingress of water and no structural movement."
The company said it did not believe the fire would affect its debt restructuring. But because it does not expect to resume full services until June, it has asked its banks to extend its debt standstill, under which Eurotunnel has suspended interest payments on its loans, until the end of the year. Passenger numbers fell by almost a half in December in the wake of the fire and the subsequent reduction in services. No freight shuttles have operated since the incident. Eurotunnel is aiming to restart freight shuttle services by the end of March and complete repairs to the fire-damaged section of the tunnel by mid-May so that it can resume a full service from June.
The plan is to have achieved a full recovery from the fire by the end of 1997. Eurostar services are back to 90 per cent of normal levels while passenger shuttle services have recovered to 50 per cent of their levels before the fire. Despite the fire, revenues rose by more than 60 per cent to pounds 450m as the number of passengers using the tunnel increased from 8 million in 1995 to 13 million. Eurostar handled just under 4.9 million passengers, giving it 66 per cent of the London-Paris market, while Eurotunnel's Shuttle service carried more than 2 million cars and 58,000 coaches, giving it a 50 per cent share of the tourist market.
So far Eurotunnel's insurers have paid pounds 34m for lost revenue in 1996 and the company said it was confident that the impact of the fire on its finances in 1996 and the first half of this year would be limited.
Last year Le Shuttle carried more than half-a-million trucks, against 400,000 in 1995, while the railways handled 2.4 million tonnes of freight. Until the fire interrupted services, passenger numbers were 87 per cent up on 1995.