IDB releases financing for new studies on HST

Inter-American Development Bank (IDB) will provide financing for a new package of studies and consulting services aimed at the deployment of the high-speed train (HST). This is a second round of investments for making the bullet train project feasible. In 2008, in partnership with BNDES, IDB disbursed near R$ 1.5 million to finance the HST planning phase, which project was made by the English consulting firm Halcrow Group. Now, with the funding from the bank, ANTT (National Agency for Land Transportation) intends to contract three consulting service types.

The first contract, aimed at the social communication area of HST, includes provisions for deploying a 0800 (toll-free) telephone service for clarifying any questions of the population, among other measures. A second contract has the purpose of preparing an expropriation and resettlement plan for the families that live in the surroundings of the train track tracing. With 510 kilometers of rail network connecting the cities of Campinas, São Paulo and Rio, the HST will include an expropriation area of 30,000 hectares, affecting near 40 municipalities, according to ANTT. The governmental company Etav will be in charge of this plan execution.

Finally, the government intends to contract a consulting firm to study the environmental impacts of the bullet train. Once this study is completed, ANTT will be responsible for achieving the preliminary environmental license with Ibama for the project, as well as providing support for the achievement of the work installation license. Until July 4, ANTT will receive the communications from companies interested in providing the services. The next step will be the selection of the six best proposals, and then carry out a bidding process.

Yesterday, Ms. Dilma Rousseff, President of Brazil, attended a meeting with ministers and the government team that follows the bullet train initiative to discuss the project. The meeting was also attended by Luciano Coutinho, CEO at BNDES, and Guido Mantega, Ministry of Finance, in addition to representatives related to the Ministry of Transports. Valor magazine raised the information that Dilma requested an update on the notice to bid progress, the key companies interested in the work and the feasibility to complete the works according to the current schedule. If no new facts interfere in the governmental plans, on July 11, the government will receive toe proposals from the consortiums interested in the bullet train construction and operation.

Envelopes with the proposals will be opened on July 29.

By now, it is expected that ANTT publishes, still this week, some punctual changes in the rules of the notice to bid –flexibility of the locations for the construction of future stations and adequacy of the technological transfer process, which will be conducted under mutual agreement between the government and the construction consortium. According to a source that followed the meeting with Dilma, the government showed its intention of keeping the current project structure, without any radical changes in the concession model.

The bullet train auction has already been postponed twice, in November last year and April this year. Once the auction is performed in next July, the government will attempt to recover the time for achieving the environmental licensing so as to start the works in the second half of 2012. As the deadline for completing the construction of the entire line is six years, there is a small chance to have the bullet train running on track until the Olympic Games 2016. However, it is possible that the consortium in charge will be able to start the commercial operation of sections already finished before the total delivery of the work.