Airport operator BAA said on Tuesday it had cut the planned cost of a new runway and terminal at its London Stansted airport by 17.5% to 1.4 billion pounds ($2.7 billion).
BAA, owned by Spanish construction firm Ferrovial, said the savings would come mainly from cutting the amount of land needed for the project by almost a third.
In 2003, the British government said the cost of the new runway and terminal would be around 4 billion pounds and require 700 hectares of land. BAA said it now estimated that it would take up 486 hectares.
BAA hopes the second runway and terminal, designed to handle an extra 10 million passengers a year, will open in 2015, but the project is facing a lengthy planning process and faces strong opposition from local residents and environmental groups.