News & Analysis

ICA, FCC win $180m water supply project in Mexico(3)

The Mexican and Spanish construction firms will build a 132-kilometre aqueduct to carry water to the central Mexican city of San Luis Potosi and develop related water purification and storage infrastructure. The project includes a 23-year maintenance contract for the facilities.

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Mexican and Spanish construction companies ICA and FCC have jointly won a Ps. 2.4 billion (€130 million; $180 million) 25-year service contract to build, operate and maintain a water supply and purification system in the central Mexican state of San Luis Potosi.

The proposed El Realito Aqueduct will bring water to the state’s eponymous capital city from a dam on the Rio Santa Maria River 132 kilometres away. The project will also involve the construction of three water pumping stations, a water treatment plant and water storage tanks.

Construction is expected to last two years and will be followed by a 23-year maintenance contract.
The Mexican Government’s National Infrastructure Trust Fund will provide 49 percent of the project’s estimated Ps. 2.4 billion cost. The balance will be provided by equity from ICA’s consortium and bank debt.

ICA is a 51 percent equity participant in the constortium via its subsidiary Controladora de Operaciones de Infraestructura. Spain’s Fomento de Construcciones y Contratas (FCC) is a 49 percent equity participant via its subsidiary Aqualia and Servicios de Agua Trident.

The contract was awarded through a competitive bidding process carried out by the State Water Commission of San Luis Potosi. Contract signing is expected to take place on 3 July, 2009.

For ICA, the news comes a week after the company announced plans for a potential capital raise through a new share offering. The offering size is to be determined at an upcoming shareholder meeting on 25 June.