The largest chunk of the $5.25 billion, five-year expansion of the Panama Canal may finally have a contractor in place, after the Panama Canal Authority named a Sacyr Vallehermoso-led consortium as the proposer for building a new set of locks on the canal.
The Sacyr-led group, called “Grupo Unidos por el Canal”, was today named the “best value” proposer for the multi-billion dollar contract, after it won the best mix of technical and price scores from among a group of three shortlisted bidders.
Panama Canal: full speed
Unidos bid a base price of $3.1 billion dollars for designing and building new locks on the canal’s Atlantic and Pacific outlets. That was about $300 million less than the authority’s base price of $3.5 billion.
A consortium led by engineering group Bechtel bid $4.2 billion, while a third consortium led by Spanish construction firm ACS bid $6 billion.
Proposals were also scored on a technical basis, where Unidos also scored the highest marks.
The proposal will next head to a price verification board – a group composed of authority employees who will verify that the price proposal complies with its requirements. Unidos’ consortium members’ qualification will also be verified.
Pending the successful outcome of this review, the authority hopes to formally award the contract for the locks in the next few days, according to a statement.
Locks are water chambers used to raise and lower ships between stretches of water at different levels. The Panama Canal’s two existing sets of locks lift ships 85 feet to the main elevation of the canal. The locks cannot accommodate larger ships that were developed in the decades after the canal opened for traffic, known as post-Panamax vessels. The new locks will alleviate this problem.
The installation of the new locks forms the largest and most important chunk of an ambitious $5.25 billion, five-year expansion project for the canal – the largest infrastructure project under development in Latin America. In addition to the construction of the locks, the program includes plans for dredging of the canal entrences, deepening and widening of its existing channels and raising the maximum operating level of Gatun Lake, which provides fresh water for the waterway. The expansion will double the canal's capacity, the authority estimates.
Procurement for the fourth and final excavation project under the expansion plan – which will link the new Pacific locks with the narrowest section of the canal – will begin soon, the authority has said.
In related news, Sufi, a Sacyr Vallehermoso portfolio company, was yesterday awarded a 20-year, €210 million waste management contract in the Spanish province of Rioja. The firm will manage Ecoparque of La Rioja, a recycling center, over that term.