The Victorian Government announced on Thursday it had selected Coleman Rail and KBR as the contractor for the $313 million project stage that would allow the faster VLocity trains onto the network.
Stage two will include 59 rail crossing upgrades between Donnybrook and Shepparton as well as platform extensions at Mooroopna, Murchison East and Nagambie stations.
The government said early work that included site investigations, industry engagement and design work would start next month.
The government said stage two was scheduled to be finished in late 2022.
State Member for Shepparton Suzanna Sheed said she expected work to start by the end of the year.
“It's great news because we know that work will start soon,” she said.
“I imagine it will be built in stages such as the extension at Mooroopna then Murchison then Nagambie and of course the passing loop at Murchison East.
“The government needs to roll this out as quickly as possible so it can work on the stage three business case.”
Committee for Greater Shepparton chief executive Sam Birrell said it was good news as it allowed work to start.
“Once the work is complete it means we can start riding VLocity trains that are faster and better,” he said.
“When stage two was announced in 2018, there have been a lot of questions asked why work hasn't started yet.
“We want to see more daily services but to reach that (stage three) we have to build stage two so let's get this done and keep the pressure on the government to build stage three.”
Mr Birrell said he was aware that, as part of an agreement in the joint venture, contractors would be hiring locally.
A passing loop extension near Murchison making it easier for trains to pass is also part of stage two, as well as building a stabling facility north of Shepparton station.
The $43 million first stage of the project allowed 10 additional weekly services for the line.
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