Where EPC player Y&V sees opportunities in South America

Regional EPC firm Y&V is sharpening its focus on water sector and renewables opportunities in target market northern South America, while maintaining its broad portfolio of services.

Much wastewater in Latin America is pumped directly into rivers, lakes and oceans, impacting human health and ecosystems. Building out the requisite infrastructure is not politically sensitive or likely to generate community opposition – but will require billions of dollars in investment. 

Y&V, founded in Venezuela 35 years ago, started off in water before diversifying into the midstream and upstream hydrocarbons, petrochemicals, electric power and civil and industrial infrastructure sectors.

“Oil and gas is a central pillar of our business and will continue to be so over the coming years, but we’re now returning to our roots, in water,” Y&V CEO César Chacón told BNamericas.

“Latin America lags far behind other regions. Opportunities are there. Wastewater in Caracas, Quito and Bogotá, for example, is untreated. Whatever nature cannot break down, remains in the water.”

Earlier this week, capital markets experts said that public water and sanitation companies in Latin America could tap the sustainability bond market.

“In the water sector, we see a lot of demand from investors, and in the region we haven’t yet explored the potential and it's a sector that needs a lot of investment; in all countries of the region, I would say, we need water infrastructure,” said Thatyanne Gasparotto, associate director of international market development at the Climate Bonds Initiative, an international organization working to mobilize the US$100tn bond market for climate change solutions.

Meanwhile, in the water sector, Y&V is participating in a tender for a contract to build an industrial water plant that would feed lithium extraction operations in Bolivia, Chacón said. 

Beyond water, Y&V is also monitoring business opportunities in emerging oil-producing nations Guyana and Suriname. While some investment is being channeled into offshore E&P, associated economic development will spur demand for onshore infrastructure.    

“We see tremendous opportunities in neighboring countries,” said Chacón. “Hospitals, schools, power plants, communications infrastructure.”  

Meanwhile, elsewhere on the industrial infrastructure map, Y&V hopes the Bolivian government will relaunch a tender process to expand the Bulo Bulo petrochemicals complex in Cochabamba department. Bolivia’s fertilizer-manufacturing sector in general presents opportunities, Chacón said. 

With a portfolio of projects across the Americas and a major footprint in the midstream and upstream hydrocarbons sectors of Venezuela and Colombia, Y&V is also entering the renewable energy infrastructure market, offering solutions in the solar and wind power segments. 

On the firm's home market Venezuela, Chacón expressed optimism.

“There are reasons to believe a ‘good enough’ political deal can eventually be struck between the government and the opposition, and this would help the country advance economically,” Chacón said. 

“Once economic sanctions are somehow lifted and political life returns to a normal path, I'm sure current political rivals could agree on addressing the most immediate country needs, in oil and gas production recovery, and reconstruction of infrastructure like electric power generation, sanitary and communication facilities. There's is a tremendous cache of incomplete projects in Venezuela that could be readily worked on. International financing will be required of course.”

And on the wider region, Chacón said the potential was “immense” citing demographics and the infrastructure gap. 

Spending on public infrastructure in Latin America, particularly over the past decade, has fallen short of what is needed. Outlay has averaged around 2% of GDP a year, below the target of 4-7% of GDP, the World Bank’s infrastructure director for Latin America, Franz Drees-Gross, told BNamericas earlier in the year.