Twenty years after it was first mooted, an ambitious undersea tunnel project - the world's longest - is inching closer to reality. It will connect Liaoning Province and Shandong Peninsula at a cost of 260 billion yuan (US$42.38 billion).

The 123-kilometer passage will link Dalian City in Liaoning and Yantai City in Shandong Province. Trains are expected to run at a speed of 220 kilometers per hour. It will also transport vehicles.

The trip between the two costal cities will be covered in 40 minutes, said Wang Mengshu, an academic at the Chinese Academy of Engineering. Right now, commuting between the two cities takes about 6.5 to eight hours on ships.

The final report will be submitted by the Chinese Academy of Engineering to the State Council, Times Weekly, a Guangdong-based newspaper, reported yesterday.

The governments of Shandong and Liaoning, and China Railway Corp will foot the bill, Wang said. He estimated that the costs can be covered in about 12 years after completion of the project. "Freight transportation is very lucrative," he said.

The cross-Bohai-Strait tunnel will also be a rich source for tax revenues - nearly 20 billion yuan a year. Other benefits include a boost in tourism and fuel efficiency, according to a study conducted by the Luzhong University.

Liu Xinhua, a Yantai city government official in 1992, initiated the proposal to construct an underwater tunnel to enhance contacts between cities and boost the economy. The government ordered a feasibility study in 1993.

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