Uruguay kicks off work on US$1bn rail PPP

Uruguayan authorities launched construction of the US$1bn Central railway PPP.

During a ceremony held at Paso de los Toros in Tacuarembó department (in photo), Tacuarembó governor Eber da Rosa said the new line would not only boost freight transport but also improve traffic conditions on the route 5 highway by reducing the number of heavy trucks, the presidency’s office said in a release.

The project entails a 274km rail line between Paso de los Toros and capital Montevideo. Works include five new bridges, replacing six existing ones, and reinforcing nine others, along with five new stations and nine underpasses.

Works are expected to take until 2021, and the line will also be used for passenger services, according to documents from IDB Invest, which is one of the main financiers of the project.

The PPP, under consortium Grupo Via Central, is considered key for the plans of Finnish firm UPM to build a second pulp mill in Uruguay.

In 2017, the company and the Uruguayan government signed an agreement on a series of infrastructure requirements for a new pulp mill, including the Central railway.