The contract to construct, maintain, finance and operate the new roads, which is the largest contract to be awarded as part of the Scottish Government’s Non-Profit Distributing (NPD) model, has officially been awarded to the Aberdeen Roads limited consortium of Balfour Beatty, Carillion and Galliford Try.

The deal has now reached financial close with construction costs on the Aberdeen Western Peripheral Route/Balmedie-Tipperty project also cut by £11m on original estimates.

Keith Brown said: “While the overall estimated scheme costs remain at £745m, the contract value, which is around £550m in net present value terms, is almost £220m less than the pre-tender estimate and amounts to a reduction in payments over the life of the contract of approximately £26.5m per year.

“The capital cost of construction also came in under the £472m estimate, (cost at 2012), by £11m on a like for like basis.

“Our robust procurement approach has been successful in driving efficiencies in both the long term maintenance operations and the funding of the project.”

The contractor is planning to deliver a more durable ‘long-life’ road, which will reduce the future maintenance requirements.

The shortened construction schedule, with project completion now due in winter 2017, has also helped to keep building costs to a minimum.

Work will start immediately and the project includes designing and constructing 58 kilometres of new dual carriageway.

The contract also includes constructing 40 kilometres of new side roads, 30 kilometres of access tracks and more than 100 new structures, including two significant focal point bridges over the rivers Dee and Don.

Alan Gibson, bid director for Aberdeen Roads said: “Aberdeen Roads looks forward to working closely with Transport Scotland in partnership with Aberdeen City and Aberdeenshire Councils to deliver this significant project, which will transform the North-east’s transportation system. Construction work will begin immediately as we work towards delivering the project ahead of schedule in winter 2017.”