Sao Paulo re-launches tender for metro line PPP project

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Sao Paulo re-launches tender for metro line PPP project

Sao Paulo state transport agency, Secretaria de Transportes Metropolitanos, has re-tendered the 4.7 billion reais (US$2.1 billion) PPP contract for the Line 18 (Bronze) of the metro network.

The new tender process was launched on May 19th and the new deadline for submission of proposals is July 3rd.

The process is now based on the new rules released on May 7 by the Brazilian Development Bank (BNDES) that will supposedly bring more competition to the tender process.

The tender process was suspended last month by the Brazil's São Paulo state audit court TCE. One of the reasons for the cancellation was the choice of the monorail technology. According to the TCE, only two firms could provide it, Canada's Bombardier Transportation and Japan's Hitachi.

The PPP contract includes construction, operation and maintenance of civil works and systems of line 18. The necessary rolling stock will also be provided and maintained by the concessionaire.

The length of the contract will be 25 years4 years for the implementation of the project and 21 years of operation. The government will fund 50 % of the investment (around US$780 million).

The monorail will connect the municipalities of Santo André, São Bernardo do Campo and São Caetano do Sul to the metropolitan region of São Paulo. The future concessionaire will be responsible for 12 stations on Line 18 (with span of 14,355 km) and the maintenance facilities.

The structuring of the PPP project was carried in collaboration with the private sector, via Procedure of Expression of Interest (PMI). Four companies delivered the feasibility studies requested by the state. However, only part of the studies received were used for the final structuring of the contract: 34.38% from Invepar-Construtora Queiroz Galvão-Bombardier's study and 46.38 % from Odebrecht's study. The studies submitted by other bidders were not used.

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