Viaducto Bicentenario (Phase 1)

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In May 2008, OHL Concesiones signed a 30 year design, build and operate contract for Mexico’s Viaducto Bicentenario. The project involved the construction of a second level, 32 km viaduct, over the urban section of the Mexico-Queretaro road, to be developed in three stages. In the first stage, a 22km viaduct was to be built along the Mexico-Queretaro road leaving Mexico City. At a second stage, an incoming viaduct was to be built; and at a third stage, a10 km extension was to be added to both viaducts. The Mexico-Queretaro’s traffic rate exceeded 300,000 cars/day in 2009. OHL estimated that the viaduct would capture 10% of traffic in its first phase, but that traffic would increase significantly when additional phases were added. The second and third phases were to begin when a certain level of traffic was achieved in phases one and two respectively. The Government of the State of Mexico planned the viaduct to improve the service of the current road and offer users a quality, fast and safe means of transport. Viaducto Bicentenario, S.A. de C.V. was formed as the project company and 100% subsidiary of OHL Concesiones SL, a 100% subsidiary of OHL Group [Spain]. In April 2008, the State of Mexico awarded OHL Concesiones the contract in an international, competitive tender against two large Mexican groups: ICA and IDEAL. The decision to grant the contract to OHL took into account the following bidding criteria, amongst others: A lower user tariff; a reversible viaduct solution, in such a way that the route commissioned at the first stage may be used in both traffic directions, relieving morning traffic flow into the city and afternoon traffic leaving the city; construction of all components outside the road site and assembly at night, with a resulting nil effect on traffic; a comprehensive solution, connecting the viaduct at its first stage with the Belt Highway of México, D.F., also operated by OHL; and an environmentally-friendly viaduct design. The cost of the first stage was approximately 260 million euro (US $361.1 million), and the total project cost of all three phases was estimated at 680 million euro (US $944.4 million). In November 2009, financing agreements were signed for the first 22km phase in the form of a 2 billion sponsor loan from OHL and a 2b billion peso loan from Banobras, Mexico's state owned development bank. Mexican bank Imbursa committed in 1 Q 2010 to refinance the sponsor loan that OHL had committed for 2b pesos which will rank pari passu with an existing Ps2 billion loan from Mexico's national development bank, Banobras. Fonadin also contributed a subordinated tranche of PS 1.5bln. The Fonadin tranche in particular set aside Ps300 million to fund construction contingencies and will be used to shore up debt service during ramp-up on the toll road, as well as address potential weakness later in the concession. The first stage became operational in September 2010 and was given an award by the State of Mexico for the best civil engineering work of 2010. Part I (5.5km) of the first phase became operational in September 2009, and tolls were later charged beginning in November 2009. The remainder of the 22km phase was still in construction as of December 2009. It is partially operational, (4.3km) but the full 22km section has not been build yet. It is expencted in 2010.