The breathtaking views of the Sierra Madre Occidental mountain range, from the newly-completed Durango-Mazatlan highway leave no viewer wondering why the drive had been nicknamed El Espinazo del Diablo (Devil’s Backbone).
A treacherous passage is now tamed after construction of a new highway, bridge and some 60 tunnels in varying lengths, which have reduced journey time by up to three hours and created a much safer roadway.
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It’s one of many infrastructure projects the Mexican government has been undertaking, and while few are as significant and dramatic, the amount of work in the pipeline is plenty strong.
According to a recent report by Timetric on construction trends in Mexico, the country has the fourth largest construction industry in the Americas, following the US, Canada and Brazil, respectively. Increased government investment and the participation of the private sector through public-private partnerships (PPPs), has bolstered infrastructure construction activity. It is the largest market in the Mexican construction industry accounting for 44 per cent of the total industry value in 2013.
As part of Mexico’s National Infrastructure Plan (NIP) 2014-2018, a series of infrastructure projects will be launched to improve bridges, ports, roads, highways, airports, railways and power supplies, which will ultimately lead to the modernisation of the country’s infrastructure. Timetric forecasts the market to increase in value to MXN 1.3tr (USD 95.5bn) by 2018.
Key trends
Since approximately 2007, the Mexican government has been encouraging the development of road infrastructure, in participation with the private sector, with substantial investments. The Secretariat of Communications and Transportation (SCT) has also allocated an additional MXN 380bn (USD 28.5bn) in the next four years, which is mostly for widening highways.
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By GlobalDataOne of the most prominent projects for infrastructural development in Mexico is the modernisation of freight and passenger railway lines. There are various rail projects in the planning and or implementation phase, such as the construction of a 209kmlong railway between Merida of Yucatan and Punta Venado of Quintana Roo; a new railway bridge and related infrastructure in the state of Tamaulipas; a light rail system between Cancun and Tulum; an 80km-railway line in Morelia and an 195kmlong rail route in Jalisco. Rail infrastructure is expected to expand at a strong rate in the coming years (see table).
Hydroelectric projects have already been driving demand for tunnel work in Mexico. In April, as part of its NIP 2014- 2018, the government announced plans to invest a further MXN 3.8tr (USD 299bn) on a portfolio of 262 energy projects. The plan focuses on extending and developing existing energy infrastructure, and energy generation, transmission and distribution facilities.
Water management
Companies like Robbins, Alpine Sales & Rental and Mining Equipment have supplied tunnelling projects in Mexico over the last several years. In particular the mammoth wastewater tunnel for the City of Mexico, the 62km-long Tunel Emisor Oriente (TEO), divided into six lots, has increased demand for equipment.
In the last 100 years, Mexico City has sunk by nearly 12m. As a result, infrastructure in the city, including buildings, roads and sewage systems, has been extensively damaged. In addition, the capital city faces flooding during the rainy season. The city currently transfers its wastewater into the Gran Canal built in 1975 through the 68km Emisor Central tunnel. The tunnel is unable to hold the huge amount of wastewater and rainwater flowing into it during the rainy season.
When completed, TEO is set to be one of the largest wastewater tunnels in the world, acting as an alternative exit for the existing Emisor Central drainage tunnel. The project is being undertaken by Mexico’s National Water Commission (Conagua), which is also responsible for management of the tunnel. The estimated cost for the project is MXN 15bn (USD 1.18bn). Construction work on the project first began in August 2008. It was scheduled for completion in 2012, but construction work halted in 2010 due to flooding.
The Secretariat of Environment and Natural Resources, the Ministry of Finance, the Ministry of Civil Service and the governments of the Federal District, Mexico and Hidalgo are all active participants in the project.
The construction contract for sections one, two and six of the tunnel was awarded to Ingenieros Civiles Asociados (ICA). Sections three, four and five have been contracted to Carso Infraestructura y Construccion. Other contractors include Civil Engineers Associates, Lombardo Star Building Construction and Comissa. CFE was contracted to carry out basic engineering works for the project. Poyry is responsible for supervising and providing technical consultancy services for the project. It is also installing its 2DOC underground data management system in the tunnel.
Mining Equipment says it has supplied fully-refurbished 26t battery locomotives plus muck cars and fully refurbished (by Mining Equipment) 25t Schoma units, among other units. The Robbins Company has three TBMs on the job (see page 35) and previously had supplied the TBM for the city’s newest subway project, Metro line 12, which opened in October 2012.
Mexico’s largest construction company, ICA, has been involved in both the Metro line 12 and TEO projects. Headquartered in Mexico City, the company, along with its subsidiaries and affiliates, operates in Mexico, the US, Spain and other Latin American countries providing engineering, heavy construction, infrastructure operations and management services. Additionally, ICA constructs, develops, maintains and operates long-term concessions of toll roads, tunnels, social infrastructure and water projects. The company classifies its operations into four reportable divisions: Civil Construction, Concessions, Airports and Corporate and Other. It reported revenues of MXN 29.5bn (USD 2.25bn) for the fiscal year ending December 2013. The firm’s Civil Construction division, which undertakes infrastructure projects including tunnels, hydroelectric plants and highways accounted for 72.48 per cent of ICA’s total revenues in FY2013.
The Concession division, through its subsidiary, ICA company Infrastructure Pvt Ltd, operates 1,000km of road in Mexico and a road project in Panama. In FY2013, the division of the company accounted for 13.22 per cent of the company’s total revenues.
This year alone, ICA secured two contracts with the National Water Commission (Conagua), to build tunnels for stormwater management.
The channel tunnel in Chalco Valley, a contract worth MXN 1.14M (USD 900,000) will be mined by an EPBM over the next three years. It’s 7.9km long and 5m in diameter, running parallel to the General Canal, from the Parada del Toro pumping station to the La Caldera pumping station. The project includes fabrication and installation of the pre-cast concrete segmental lining, installation of the finish lining and covering, and construction of four 12m-diameter drop shafts, with an average depth of 25m each.
For another contract awarded this summer, worth MXN 2.566bn (USD 197M), ICA will build a tunnel aimed at reducing flood risks in the centre of the country. The Churubusco-Xochiaca tunnel project includes the construction of a 13km-long tunnel that is scheduled to take 29 months for construction.
Growing pains
While the construction industry in the US, the largest of all the Americas, is six times larger than that of its most southern neighbor, the Mexican construction industry is expected to grow by nearly five per cent over the next four years.
According to Timetric analysis, Mexico has the fourth-largest economy in the Americas (of nine), however it’s the second slowest-growing economy, and the third slowest-growing construction industry. Billions of dollars will be spent in the next four years to develop the country’s infrastructure, but it’s not the only neighboring market with project potential
