Transurban Group (TCL) has reached an in-principle agreement with the Victorian government for an $850 million upgrade to the western section of CityLink, the Bolte Bridge-West Gate Freeway interchange and the Tullamarine Freeway.
The company said its full-year 2015 distribution guidance of 39c would be unaffected by the project, which is set to address congestion and safety on the road and is still subject to Transurban reaching final agreement with the state.
Transurban chief executive officer Scott Charlton said the amount of weekday traffic on the western section of CityLink has more than doubled since 2000.
"The proposed project is a critical component of overall road transport improvements to the rapidly growing western corridor of Melbourne," Mr Charlton said.
"We acknowledge that there will be some disruption to motorists using CityLink during the construction period, although we will be careful to minimise this as much as we can."
Transurban will finance the total cost of the upgrade works under the terms of the agreement, with toll price increases to remain at a minimum of 4.5 per cent annually for an additional year after July 2015.