Water. Desalination + reuse
Issue link: https://fhpublishing.uberflip.com/i/749211
Water. desalination + reuse December 2016 In Site 27 Mega-project has several unique characteristics The drivers • Initially to supply the city of Tijuana • Next phase may involve a cross- border water deal with US, giving the project a bi-national flavour • Structured according to Mexico's Asociaciones Publico-Privadas (APP), law on public-private partnerships ProacTive ProjecT • Project grew out of ideas and studies initiated by Consolidated Water • The company secured land and other rights of way from the Rosarito Power Plant • APP introduced a clearer framework for projects that helps to attract private investors The Rosarito Seawater Desalina- tion Plant project is a multi- faceted piece of work that relies on input from, and partnerships with multiple agencies, indi- viduals, administrators, and regulators. Once built, the plant will be twice as big as any other desali- nation plant in the Americas, or the entire Western hemisphere. "The magnitude of it in terms of a global desal project, and the size and importance of it to Baja Norte — it's the region's biggest infrastructure project ever, and one of the biggest public-private partnerships anywhere in Mexico — is very exciting. It's a really big deal for the region's water supply, and not just in Tijuana, but also in San Diego, California," says John Tonner, vice president and chief operating officer of Consolidated Water. As a Mexican project, it will be financed in pesos, and there is potential to work out a cross- border deal on water supply with the State of California, US, giving the project a bi-national flavour. When Mexico's new public- private partnerships law, Asociaciones Publico-Privadas (APP), came into play, it provided a clear legal framework for the project. Under the terms of the law, private developers can propose to the state ideas for studies on issues like the feasibility, environmental effects, and social impact of a project. Shape of the project Consolidated Water lines up Mexican mega-project • Playas de Rosarito project will be largest desalination plant in the Western hemi- sphere • Finance is to be raised in Mexican pesos • Potential for the future sale of water across the border into the US The Playas de Rosarito seawater RO desalination mega-plant project has been six years in the making. It began as a twinkle in Consolidated Water's eye even before Mexico had introduced its new public-private partnerships law, but the act's introduction in 2012 gave the project a clear structure for moving ahead. At that point, Consolidated had already done much initial project scoping, however the terms of the new law mandated that it tender in a competitive process with only a very slight advantage. The firm's speculative activity in laying the groundwork for the project paid off, and it won the commercial contract in August 2016. The Playas de Rosarito project, whose estimated total cost is MXN9 billion ($490 million), is a huge initiative for the State of Baja California, one of the largest infrastructure projects ever to have been undertaken in the region. Hopes are high that it will support economic growth, particularly in terms of tourism trade. The next big milestone for the mega-project will be financial close in early to mid- 2017. Construction will then commence in two phases: the first delivering water into the city of Tijuana's potable water system; and the second to a delivery point in central Tijuana. Finally, there is the potential for the Rosarito plant to supply water across the border into California. The conTracT • APP contract covers design, construction, financing, and operation • Covers seawater desalination plant and accompanying aqueducts • Water rates are indexed to the Mexican national consumer index Two Phases • Phase one: capacity of 50 million gallons a day and an aqueduct to the Tijuana potable water system • Phase two: capacity of 50 million gallons a day and an aqueduct to a second delivery point in Tijuana Consolidated Water signed a public-private partnership APP deal with the State of Baja California on 22 August, 2016. The tender had been a competitive international tender and, as Tonner says, Public-private partnership The APP agreement sets the foundation for the future Consolidated Water "had to fight tooth and nail with other experienced, international desalination companies" — a process that ultimately "kept the costs down". The contract was signed through Aguas de Rosarito (AdR), a special purpose vehicle owned by NuWater and NSC Agua, a subsidiary of Consolidated Water, for the design construction, financing, and operation of a seawater desalination plant in Playas de Rosarito. The project is split into two halves, the first covering a 50 million gallons a day desalination plant and a 14km aqueduct to deliver water into Tijuana's potable water system, and the second for another 50 million gallons a day plant, and an aqueduct to convey water to a central delivery point a further 15km into Tijuana. Phase one must be operational within 36 months of commencing construction, and the second by the end of 2024, although the state could bring that date forward. The operations and maintenance part of the contract runs for 37 years from the date of commissioning of phase one. At the end of the period, ownership of the plant and aqueducts will transfer to Baja California State Water Commission (CEA).