Spotlight: Brazil's June tender schedule

Brazil's tender schedule for June focuses on streetlighting PPPs and infrastructure contracts, to be offered on the B3 stock exchange, while geological service SGB will offer mining exploration areas in separate auctions.

Four of the B3 tenders relate to streetlighting PPPs, while an airport maintenance and a water network contract are also on offer. 

The mining tenders for five areas are the first under the Luiz Inácio Lula da Silva administration, which took office in January 2023.

"Streetlighting PPPs are contracts linked to city halls. As there will be municipal elections in October, we're seeing the auctions brought forward. We’ll see many fewer public streetlighting PPP auctions in the second half of this year because of the election process," João Cortez, a partner at infrastructure consultancy Vallya, told BNamericas.

The four contracts involve combined investment of 581mn reais (US$113mn) and three will be offered on June 7, covering the municipalities of Araguari in Minas Gerais state, Fazenda Rio Grande in Paraná and Teixeira de Freitas city in Bahia.

The PPP for Araguari, which has 117,000 residents, involves the installation and maintenance of 24,000 LED points over the next 14 years, with investments of around 110mn reais.

Teixeira de Freitas, with 145,000 residents, will require installation and maintenance of 27,000 light points over 18 years for around 119mn reais.

Another 132mn reais will be invested in Fazenda Rio Grande to install and maintain 25,000 light points over the next 18 years to benefit 148,000 people.

The contracts were structured by state-run bank Caixa Econômica Federal.

A fourth contract, for Santa Maria city in Rio Grande do Sul, will be offered on June 14, involve 220mn reais and be valid for 24 years. Some 28,000 light points must be installed. The contract was structured by regional development bank BRDE.

INFRASTRUCTURE

Bahia state water utility Embasa will hold an auction on June 3, offering a 130mn-real contract for the first stage of the integrated water supply system in Praia do Forte, Mata de São João municipality. The work is part of investments to expand treated water supply along the state’s north coast.

On June 20, Rio Grande do Sul state will offer a PPP for maintenance of and improvements to the regional airports of Lauro Kortz in Passo Fundo and Sepé Tiajaru in Santo Ângelo. The government will contribute 29mn reais, while the investments in the two airports are expected to total 101mn reais.

MINING ASSETS

SGB plans to offer gold, diamond, phosphate, gypsum, limestone and kaolin exploration areas on June 4. Similar auctions were common during the previous Jair Bolsonaro administration (2019-22).

"I believe that we will have more auctions of mineral assets in the next quarters amid progress of works for geological mapping to increase potential in the diversification of mining linked to the energy transition," Valdir Farias, CEO of mining consultancy Fioito, told BNamericas.

Five areas to be offered are in Pará, Tocantins, Pernambuco, Paraíba and Bahia states.

Aveiro (Pará)

Agrominerais Aveiro combines the Gipsita Rio Cupari and Calcário Aveiro projects, which encompass three gypsum-bearing areas, totaling 2,887ha, on the banks of Cupari river. A 998ha limestone deposit is located around 30km from the gypsum areas.  

With planned investments of 5mn reais in exploration, the areas have the potential to serve the domestic market and attract international buyers, SGB says. Resources total around 681Mt of gypsum and 588Mt of limestone.

Capim kaolin project (Pará)

Also demanding around 5mn reais in exploration, the Rio Capim deposit in Ipixuna do Pará municipality is expected to contain around 800Mt of kaolin, a mineral used in the ceramics, paper, paints, plastics and pharmaceutical industries.

Santo Inácio diamond project (Bahia)

The area is in central-northwest Bahia, in the district of Santo Inácio in Gentio do Ouro municipality. Containing around 245Mt of diamond gravel, areas of the deposit will be made available in the auction.

The initiative represents an opportunity to attract investments to the region, promoting job creation and boosting the local economy, SGB says. Investments in exploration are expected to be 5mn reais.

Miriri phosphate project (Paraíba and Pernambuco)

The project involves areas in the coastal region of Paraíba and Pernambuco. It comprises seven mining areas, with potential to extract up to 114Mt of phosphate ore, essential for the production of fertilizers.

Investments of around 2mn reais are expected in exploration.

Natividade gold project (Tocantins)

The Natividade gold project is in the south of Tocantins state and is expected to attract planned investments of up to 20mn reais in exploration.

OTHERS

A 20-year maintenance contract covering the Santos and Cananéia fishing terminals in São Paulo state, the Aracaju terminal in Sergipe and one facility in Natal, Rio Grande do Norte, will be offered on June 25. The highest fee proposal will win, according to the agriculture ministry.