Uruguay plans to award contracts to widen over 300km of roads before June

Uruguay’s transport ministry (MTOP) plans to award three contracts worth over US$550mn by the end of May to widen 338km of highways by adding new lanes with a view to beginning works during H2. 

Once works related to the second pulp mill of Finnish firm UPM, including the US$1bn Central railway, start to wrap up, MTOP wants to have other projects ongoing to prevent a net loss in jobs in the construction sector, minister José Luis Falero told news station Teledoce.

The contracts that are close to being awarded under the CREMA (construction, rehabilitation and maintenance) model.

Route 5, widening stretch 1: Falero said this is expected to be awarded this week. The contract received four offers with the highest being 3.9bn pesos (US$96mn). It entails widening a 52.7km stretch in Florida department between Mendoza and La Cruz.

Route 5, widening stretch 2: This is expected to be awarded during the first half of May. It received three bids, and the highest was 5.4bn pesos. It entails widening 76.7km between La Cruz and the south access of Sarandí Grande. 

Route 9 widening: Also expected to be awarded during May, it received only two offers, with the highest being 13.2bn pesos. It involves widening 209km between Pan de Azúcar (Maldonado department) and the namesake capital of Rocha department.

Falero said a US$103mn PPP to widen route 6 is also expected to be under construction in the second half. This contract entails 71km between Belloni and San Ramón (Canelones department) and was awarded to a consortium comprising Rover and Construcciones Viales y Civiles.

PPP VS CREMA

On the CREMA contract model, the minister said it presented an opportunity to launch more road tenders compared to PPPs. 

“[PPPs] are a valid tool, but are very expensive when it comes to financing. That’s why we sought out an intermediate financing model in which the builder or awarded firm is forced to complete the works in three years at the most, and the payment is made during the following seven years [of maintenance],” he said. 

Since replacing PPPs with CREMA contracts in 2020 for new road projects, MTOP has been able to launch more tenders, the minister said. 

Earlier this month, the head of the ministry’s secretariat, Graciela Soler, told BNamericas that MTOP does not plan to modify its PPP framework in the short term.