The New Zealand Transport Agency (NZTA) has announced a $168.7m funding package to design and build the 7.2km Te Rapa section of the Waikato Expressway on State Highway 1.

The project will be funded by $156.7m from NZTA with the remaining $11.7m from Hamilton City Council and $0.3m from Waikato District Council.

Connecting the Ngaruawahia section to the Waikato Expressway, the Te Rapa section will include two new major intersections.

The design and build contract has been awarded in a three-way partnership between construction firm Fulton Hogan, engineering consultants Opus International and the NZTA.

Waikato-Bay of Plenty regional director Harry Wilson said the expressway was less about reducing travel times and delays and more about driving economic growth in the region, especially in Hamilton.

Three new intersections and bridges will also be built alone with the widening of a 1.6km section of the existing road.

The construction work is expected to begin in September 2010 and to be complete by 2013.