Brazil sweetens terms for Rio-Sao Paulo bullet train

Thu Dec 13, 2012 7:07pm EST
 

By Anthony Boadle

BRASILIA (Reuters) - Brazil set more attractive and less risky terms on Thursday to attract international bids to operate a high-speed train between its two biggest cities after an attempt last year found no takers.

The planned 350 km per hour (217 mile per hour) bullet train will run between Rio de Janeiro, Sao Paulo and the fast-growing adjacent city of Campinas by 2020, said Bernardo Figueiredo, head of the government agency in charge of infrastructure projects.

The government will shoulder more of the risk by raising to 45 percent from 30 percent the public stake in the consortium that will design the high-speed system, provide the technology and the trains for it, and operate it on a 40-year concession.

"It's a way of sharing the risk with the investor and making the project more attractive," Figueiredo told a news conference.

The winner must invest an estimated 7.7 billion reais ($3.7 billion), offer economy class tickets of no more than 200 reais ($100) and guarantee that trains cover the 260 miles between Rio and Sao Paulo in no more than 99 minutes.

To qualify to bid, companies cannot have had a fatal accident on an existing high-speed system they operate in the past five years. That's down from the 10 years required earlier.

The new auction to pick the operating consortium will be held on September 9, 2013, at the Sao Paulo stock exchange Bovespa.

A second auction in 2014 will choose the engineering group that will build the track, with a minimum investment of 27.3 billion reais, Figueiredo said.   Continued...