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Brazil restarts high speed rail tender

Brazil’s National Transportation Agency (ANTT) has reopened bidding on its mooted £13bn Rio de Janeiro to Sao Paulo high speed rail line.

It is now seeking bids from firms wanting to operate and maintain the 510km route, with the winner to be selected in a blind auction in August next year.

The firm selected to operate the line will no longer have to build it, after no bids were received when the contract was last up for grabs in July 2011 despite the bid deadline being repeatedly put back from the original 29 November 2010 date.

Firms were unwilling to take on construction risks: the high speed line is technically challenging with the route including 90km of tunnels and 108km of bridges. The contract structure was also tough, with the concessionaire only getting 35 years to recoup costs from an anticipated six or seven years of construction. The concessionaire was expected to take on all risks, including construction costs, operations, demand and revenue. Regulation to safeguard the public interest demanded that the winning bidder would be the one that offered to charge the lowest fares.

To tackle this ANTT has stripped out construction from the deal, with the winning firm responsible for buying the trains and then operating and maintaining the line. Once appointed it will then be responsible for selecting contractors to build the line, with work divided into smaller packages.

Bidders are now expected to include France’s Alstom and a Japanese consortium. There may be other bidders from Italy, Germany, Spain, China and South Korea, according to ANTT.

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