Aguas Tratadas de Xalapa

cancelled

Closed

In September 2003 the Municipal government of Xalapa, Mexico, awarded a 20 year build, own and transfer contract for a wastewater treatment plant and sewage collection network in the city to private operator Aguas Tratadas de Xalapa (ATX). The contract included: building a treatment plant capable of processing 17-million gallons of wastewater per day; the construction of 40 miles of sewers; the installation of two pumping stations; and operating the sewerage and wastewater treatment services. The construction part of the project was intended to be completed in two years, after which ATX was to operate the infrastructure for 18 years. Xalapa was the capital of the state of Veracruz and had a population of 400,000. ATX was awarded the greenfield contract following a competitive bidding process organized by the Municipal Water Commission of Xalapa and started in April 2003. Aguas Tratadas de Xalapa was a special purpose consortium created by three companies: US based Earth Tech (a subsidiary of Tyco International), and Mexican firms CAABSA Constructora, and Arquictectos Aguayo. The project reached financial closure in March 2004. It was estimated total costs would be around $55 million. Forty percent of the project financing was provided by the Mexican government through its Fondo de Inversion en Infrastructure (FINRA), administered by the El Banco Nacional de Obras y Servicios Publicos, S.N.C. (BANOBRAS). The remainder of the financing costs was provided by the private operator through a mix of equity and loans. In March 2006 the local government canceled the contract. Construction on the project, initially intended to be completed in 2006, was under 40% finished. An audit requested by the local government estimated the private operator had only invested some $8 million in the project. No information available from Earth Tech about ownership share in project; construction companies assume shares less than 15 percent. Contact1: David Stanton: VP of International Asset Management (tel:562-951-2016; email:d.stanton@earthtech.com) Contact2: Raynette Takizawa (tel: 562-951-2037; email: raynette.takizawa@earthtech.com) please put 100% private and 8 mlm actual inv in facilities in 2006 after water update

Water and sewerage

World Bank Group

Project

Commercial, Water Supply and Storage, Government, Waste Processing and Treatment