Cheung Kong Infrastructure Holdings (CKI)'s 50-per cent owned Sydney Cross City Tunnel operator is in talks with creditors over a debt restructuring plan, the Li Ka-shing controlled flagship disclosed. CrossCity Motorway, which owns the 15-month-old, 2.1km tunnel, is on the brink of going into receivership, with a A$580 million (HK$3.46 billion) debt, according to the city's Daily Telegraph. Analysts expect the financial woes of the A$1 billion tunnel could prompt CKI to further write-down some losses this year after taking a HK$578 million impairment loss on the asset last year. Its remaining investment value on CKI's books is about HK$2.4 billion. The tunnel is one of CKI's two toll roads in Sydney. The other is the 40 per cent-owned Lane Cove Tunnel scheduled for completion next year. The CrossCity problem stems from significantly lower traffic than CKI and its partners, Deutsche Asset Management and Bilfinger Berger, had initially estimated. Deutsche Asset Management holds a 30 per cent stake and Bilfinger a 20 per cent stake. A research report by Deutsche Bank Hong Kong last month said that daily traffic at the tunnel was 35,000 vehicles to 37,000 vehicles, less than half of the consortium's 90,000-vehicle estimate. Designed as an alternative route from the congested roads in the city's main business district, the tunnel has been under-used due largely to its A$3.5 charge each way for a two-minute ride. 'Our role in the project is an investor,' said a CKI spokeswoman. The German brokerage, while maintaining a 'buy' recommendation on CKI shares, forecast the company would bear a HK$175 million loss from the tunnel this year. Deutsche Bank estimated CKI's net profit for this year will come in at HK$3.81 billion, below the Thompson First Call consensus of HK$4 billion and down from last year's HK$6 billion which included exceptional gains from asset sales in Australia. CKI shares gained one HK cent yesterday to HK$23.60. The shares have dropped 6 per cent in the past year, even as the Hong Kong stock market has rallied to record highs.