COUNTRY IN FOCUS
Mexico – Prioritization of
Water and Sanitation Megaprojects




 
Today’s post will focus on Mexico, a place that many outsiders have a negative impression of due to media reports of violence over the last decade but nonetheless has a new government committed to upgrading infrastructure in major ways.

 

 

A. Infrastructure Plan

 
The $600 billion “Mexico’s National Infrastructure Plan 2014-18 (NIP)” allocates funds for modernization in sectors such as transportation, energy, and housing, with water receiving $32 billion distributed among 84 projects. The deficits these funds target stem from over extracted aquifers in the country’s most populous regions, environmental degradation from low municipal wastewater coverage (47.5%), and an aging potable water conveyance and treatment apparatus.

A good starting point when seeking work in a country you are unfamiliar with is to identify the main water management problems and understand where big investments are happening. Familiarizing yourself with anticipated projects also clues you in to the companies present in the country you would like to relocate to. CONAGUA, Mexico’s national water agency through which bids are approved and federal monies distributed, has approved several ambitious projects with the help of NIP and public-private-partnerships. The projects are scattered throughout the country, including the Federal District, Guanajuato, Nuevo Leon, Oaxaca, Jalisco, and Baja California Sur.


 

B. Drinking water supply and wastewater treatment


One of these is a US$2.8 billion drainage system for Mexico City called the Eastern Transmission Tunnel. A 23-foot diameter tunnel will transfer storm water and sewage to a new treatment plant 38 miles north of the capitol (Atotonilco Municipality). According to Spanish firm Acciona, who are among the consortium under contract for the construction, operation, and maintenance of the plant, it will be the world’s largest in terms of volume of water treated (maximum capacity 50 m3/second) and the treated wastewater is to be used for irrigation in the surrounding farmland. While the treatment plant is nearing completion, the transmission tunnel is not due for operation until 2018. The contractors include Mexican firms Grupo ICA, Grupo Carso, and Cotrisa & CESA/Lombardo.

Another Mexico City project, this one on the drinking water end, is upgrades to the Cutzamala System. Spain’s FCC and Hermes Infraestructura Group will work in coordination on a 2.3 meter diameter 18 km steel pipeline valued at US$75 million to augment the city’s existing 20 m3/s system. Aqualia has also won a US$17 million contract from the national oil company, Pemex, to renovate the water intake system for the Cactus and Nuevo gas processing centers in the state of Tabasco. Monterrey, the third largest metropolitan area in the country, will also have a water supply megaproject procured through a public-private-partnership to bring 5 m3/sec to the 4.2 million residents. This one, the Monterrey VI Aqueduct, will be a 372Km 2.13m diameter pipeline with six pumping stations, a sludge treatment plant, and 75.000m3 storage tank. Those involved with different stages of the US$1.4 billion project include Controladora de Operaciones de Infraestructura, RECSA, Grupo HIGA, Concreto y Obra Civil del Pacifico, Desarrollos Rogar, and EECSA Concesiones.

For a more comprehensive list of projects supported under this program check out the US Department of Trade report that includes budgets, timelines, and managing parties. Bluefield Research also conducted a study of Mexico’s water sector. Some foreign companies they identify with either an established or growing presence in Mexico include Abengoa, Degremont (Suez Environment), Doosan, Hyflux, Mitsui, Sumitomo, Tedagua, and Veolia Water. In addition to multinationals, Mexico has several established players in the domestic realm. The largest of those is Atlatec, which accounts for 70% of the municipal wastewater treatment market. Others notable names are Dycusa, Fypasa Construcciones, Grupo Financiero Iteracciones, ICA (Empresas ICA S.A.B. de C.V.), IDEAL (Impulsora del Desarollo y el Empleo en America Latina), Marhnos, and Tecnologia Intercontinental.


 

C. Desalination

 
Reverse osmosis desalination has become a viable option to reduce stress on over-extracted aquifers. Though Mexico has nearly two hundred desalination plants up until recently these have been small, localized projects. Mexico’s most arid states, the neighboring Baja California and Baja California Sur, are the focus of the country’s growing utilization of desal. The biggest operational plant is the Los Cabos facility (20.000m3/d) that went on-line in 2007 and the Spanish company in charge of the design, construction and operation -GS Inima- recently won a contract to construct another in Ensenada (US$48 million 21.600m3/d).  It has also been reported that Consolidated Water has receive government clearance to move ahead on a 378.000 m3/d plant in the north of Baja. Other cities in the area where proposals are being targeted are Cabo San Lucas, La Paz, Sierra de la Laguna, Rosarito, and San Quintín.


 

D. International Development Projects

 
The World Bank, whose history in Mexico includes a US$90 million Mexico City water supply project in the early 1970’s, in 2014 approved a US$55 million loan to support the Oaxaca Water Supply and Sanitation Sector Modernization Program. Oaxaca is one of Mexico’s poorest states with over 23% of the population living in conditions that the federal government considers “extreme poverty” and only around 70% of households have access to water and sanitation services. One interesting aspect of this development program when compared to the public-private-partnerships mentioned above is that besides the infrastructure component, the investment extends to improving the water law and institutional arrangement as well as integrating poverty reduction into the water sector improvement schemes. It further concerns itself with reforming both the water metering and tariff structure to recuperate more of the cost for water services, where presently only 46% of produced water is billed and only 43% of the amount billed is recuperated. The project includes both an urban component and a statewide component, which will reach out to the numerous indigenous communities in rural areas. The upgrades in the urban component will be focused on one neighborhood (San Juan Chapultepec) of around 50.000  residents and include renovation and/or installation of drinking water treatment plants, distribution pipes, and metering systems. This initial upgrade to San Juan Chapultepec will then be used as a model for later investments and improvements in the coming decades.


 

E. Study and Research Opportunities

 
Two of Mexico’s best Universities are the private Monterrey Institute of Science and Technology and the public National Autonomous University of Mexico (UNAM). Both have highly ranked engineering and sciences programs at the graduate level and also fund numerous research studies. Other institutions whose researchers and faculty routinely present and publish investigations related to water management and conservation in Mexico include the Mexican Institute of Water Technology, Mexico Academy of Sciences, the Latin American Faculty of Social Sciences, University of the Americas – Puebla, and the Fondo Golfo de Mexico A.C.
 


By Carter Franz
Freelance Water Consultant


 
 

Published on 2015-05-27 19:56:29

 
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