Spotlight: Brazil's October tender agenda

Brazil will launch at least six tenders in October, offering contracts in the highway and water segments, among others.

The auctions for the concessions and PPPs will take place on the B3 stock exchange in São Paulo.

"The infrastructure sector in Brazil, mainly the highways and water segments, is experiencing a virtuous cycle, with the combination of new projects offered, available financing structures and legal certainty," Alberto Sogayar, an infrastructure lawyer at Sogayar e Alcântara Advogados, told BNamericas.

On October 30, São Paulo state will offer the Rota Sorocabana highway concession. The 460km route connects 17 localities in the state and projected investment over the 30-year concession period is 8.7 billion reais (US$1.6bn).

On October 31, the federal government will reoffer the 8.5bn-real concession for the BR-262 highway in Minas Gerais state. The main works under the 30-year concession include building 44.3km of divided highway, 169km of additional lanes and 3.63km of side roads, along with 10 viaducts and 17 footbridges.

Brazil has seen a series of concession contracts being offered in recent months, which paves the way for a surge in investment in the road segment.

"Just like the expectation for 2024, in 2025 we will break another capex record in terms of highway concessions. By August, which is the most recent data we have, the capex of our member companies reached 9bn reais. As a comparison, in all of 2023 it was 11.2bn reais, meaning we’re already close to last year’s capex," Marco Aurélio Barcelos, president of highway concessionaire association ABCR, told BNamericas.

“Investments continue on a very strong trajectory, and we’re heading towards a peak. I still don't have exact data for next year, but we will likely exceed 15bn reais in capex, which will easily be a new record,” he said.

Meanwhile, Piauí state is expected to offer a 9.57bn-real water concession contract on October 30. 

The 35-year concession covers operation and maintenance of a 5,253km potable water network and 601km of sewage systems. The concession is aimed at providing potable water supply to 99% of the population by 2033 and sanitation services to 90% by 2040.

As with previous auctions, analysts expect strong competition for the upcoming highway and water services contracts.

OTHER AUCTIONS 

On October 29, São Paulo state will offer the first of two lots of construction and maintenance PPPs for public schools. The first lot covers 17 schools and the second, to be offered November 1, 16 facilities.

The 25-year contracts will include construction, maintenance, conservation, and operation of non-pedagogical services. The projected investments in both lots is expected to reach 2.1bn reais.

Among the other auctions is also a lottery contract to be offered by São Paulo state.