Paraná's Sanepar sets new auction date for US$1.1bn water service PPPs

Brazil’s Paraná state utility Sanepar delayed by a day an auction for three PPP contracts to provide water and sanitation services.

Initially planned for May 21, now the auction will be held May 22 on the São Paulo stock exchange, a company spokesperson told BNamericas.

The day before the auction, Sanepar will publish the names of the companies qualified to participate, added the official.

Paraná state’s audit court had suspended the auction in response to a request made by local company Aegea contesting a rule that allows two or more bids only if no other party is interested in the respective contract. Aegea claims companies should be able to bid for all three contracts without restrictions to allow for synergies.

However, Sanepar appealed the decision and obtained the green light to proceed. 

Meanwhile, the firm unveiled a new projection for investments.

According to the Sanepar spokesperson, the three 24-year contacts are expected to generate up to 6bn reais (US$1.1bn) in investments, with 3bn reais for new works and another 3bn reais for operations and maintenance.

The contract for lot 1 is for 36 municipalities in the state’s center-east and will benefit 221,900 people. Lot 2, in the west, covers 48 municipalities, providing services to 323,800 people. Lot 3, also in western Paraná, involves 28 municipalities and services for 328,800 people.

Project finance officials at banks who are evaluating details of the auction told BNamericas, on condition of anonymity, that the PPP contracts are likely to attract the interest of large private sector players such as GS Inima, Iguá Saneamento and Acciona, as well as Aegea.