2001 Annual Report - Edmonton International Airport

13. Commitments:Edmonton Airports has planned a redevelopment and expansion of the International Airport terminalfacilities (the ATR Project). The total cost of this project is estimated to be $300 million. Of the $300 millioncontemplated, Edmonton Airports’ Board of Directors has approved the implementation of projects totaling$256 million. The major elements of the approved projects include:Phase 1 The construction of a parkade (completed in 1998),Phase 2 Expansion of the terminal facilities to the southeastand construction of additional apron area (completed in 2000),Phase 3 Construction of a Central Hall (to be completed in 2003),To December 31, 2001, expenditures of $195,506 (2000 – $166,453) have been incurred on the approvedprojects, with approximately $56 million in costs remaining to complete Phase 3.The Board of Directors has also approved in principle Phase 4, which will be the airside expansion of theNorth Terminal Building together with customer service level improvements with design work to commencein June 2002.Edmonton Airports has operating contracts for the provision of management, security, janitorial services,and electricity. These contracts have annual commitments as follows:2002 $ 7,6442003 5,6812004 5,1902005 5,2852006 4,156Edmonton Airports also has an agreement to spend up to $1,050 in 2002, subject to certain conditionsbeing met, for leasehold inducements related to tenant improvements on Edmonton Airports’ land.Edmonton Airports pays lease payments to Landlord which are calculated under a formula which includesannual airport revenue, passenger volumes and operating costs. The maximum net annual lease paymentobligation for each of the years 2002 through 2005, subject to a Consumer Price Index adjustment andafter the deduction for the annual Canada Lease capital credit, is estimated as follows:2002 $ 1,7042003 2,6832004 3,4572005 4,203Edmonton Airports and other Canadian airports are currently engaged in negotiations with the Landlord torevise the rent formula for 2006 and beyond. In the absence of an agreement, the rent formula will revertto the original lease agreement which would result in an estimated net annual lease payment of $17,000 in2006.14. Comparative figures:Certain of the 2000 comparative figures have been reclassified to conform to the presentation adopted inthe current year.53