Manzanillo TEC II (Phase I)

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In November 2009, ICTSI was awarded a 34-year concession for the development and operation of the second Specialized Container Terminal (TEC-II) at the Port of Manzanillo by Administracion Portuaria Integral de Manzanillo, S.A., de C.V. (API) . In June 2010, ICTSI signed a 34-year concession agreement and established Contecon Manzanillo S.A. (CMSA) as the project company. CMSA paid upfront fees of MXN50.0 million (US$4.1 million) to API in two installments: MXN25.0 million (US$2.0 million) on June 3, 2010, the date of signing of the contract; and another MXN25.0 million (US$2.0 million) on September 17, 2010. The container terminal was to be built in three phases. The first phase was to involve 42 hectares with 720 meters of quay length. CMSA was to build, equip, operate and develop the terminal that will specialize in the handling and servicing of containerized cargo. Investments in the Port of Manzanillo include maritime works, dredging, quay (including crossbeams and fenders), maneuver yards, storage installations, land access and signals, as well as all those works necessary to fulfill the productivity indexes contained in the contract. Construction of the first phase development, which started in November 2011, was expected to be operational in May 2013. For the first phase, CMSA was to pay fixed fees of MXN163.0 million (US$13.2 million) divided into 12 monthly payments, payable in advance. When CMSA has received the second and third phases of the ceded area, CMSA was to pay additional annual fixed fees of US$5.9 million (MXN72.3 million) and US$6.8 million (MXN83.8 million), respectively. Furthermore, CMSA was to pay monthly variable fees of US$16.2 (MXN200) per TEU, for a maximum of 1,500,000 TEUs per year. Minimum lease payments were: due in 2013 amounted to US$14.6 million (MXN187.6 million); due starting 2014 up to 2017 totaled US$62.1 million (MXN0.8 billion); and due starting 2018 onwards totaled US$632.4 million (MXN8.1 billion). The total investment for the first phase was estimated at US$ 238.84 million. Construction started in November 2011 and was due to finish in May 2013. In December 2012, a report was released by the local government of Colima declaring there was evidence of significant construction on the first phase and that it would be completed by May 2013. No debt facility was reported by ICTSI and the project appears to be financed with equity from the parent company. Mexico's government authorised the operation of TEC II in July 2013, and operation by Contecon actually started in August 2013. In November 2014, the IADB approved a US$ 90 million loan to the project.