LONDON - The first major contracts for Britain's biggest ever rail project, worth $8.7 billion, were announced Monday by Transport Secretary Chris Grayling.

The high-speed HS2 rail will eventually link London with central and northern England, with the total cost currently said to be around $74 billion.

Grayling said the first major infrastructure contracts will cover the main civil engineering work on the first phase of HS2 between London and Birmingham. The work includes the construction of tunnels, bridges, embankments and viaducts.

The first phase between London and Birmingham is scheduled to open in 2026, with phase two to Manchester in the north-west and Leeds in the north-east due for completion in 2033.

Grayling said: "This is a hugely important step in the construction of Britain's new railway. HS2 will deliver vital links between some of our country's biggest cities, helping to drive economic growth and productivity in the north and midlands."

David Higgins, chairman of HS2 Ltd, said: "This is a huge day for the HS2 project and for the country. These contracts will support 16,000 jobs in Britain and will create opportunities for thousands of SMEs."

The Department for Transport (DfT) said HS2 construction will create up to 25,000 jobs and 2,000 apprenticeships. A further 3,000 people will operate HS2 network, and it is estimated that growth around new HS2 stations will create another 100,000 jobs.

A number of joint venture consortia have been awarded the first contracts. With preparatory works already underway on phase one, the DfT says main construction work will start in 2018/19.

Grayling published Monday a new government bill for the next phase of HS2, from Birmingham to Crewe in northern England. This will cut journey times to London from the north of England and Scotland in 2027, six years earlier than planned. Grayling also confirmed the final leg of HS2, or phase 2, covering the stretches to Manchester and Leeds.

HS2 has divided opinion in Britain with environmental groups and some politicians calling for it to be scrapped altogether. In a media interview Monday, Grayling rejected a weekend report by a quantity surveyor who claimed HS2 will cost almost double the current estimate, taking the final bill to over $130 billion. Campaigners have also said the rail will ruin one of the best known areas of traditional English countryside known as the Chilterns.