Sometime late this year or early next contracts will be awarded for what is already being billed as the largest roadwork project in Latin America.
The project is a 13.9-kilometre tunnel through the Andes mountains to link Argentina on the Atlantic side and Chile on Pacific side of South America. It will be a 10-year job and is expected to cost the equivalent of C$1.9 billion.
A group of forward thinking businessmen and politicians first floated the idea more than 80 years ago. But relations between the two countries have sometimes been strained and at one point, when both countries were ruled by dictators, they seemed headed towards war. That was about 40 years ago.
With both dictators gone, talk of the tunnel began again. Then, two years ago, the Inter-American Development Bank announced it would finance the project.
The bank’s Jose Luis Lupo says the objective “is to reduce, through the construction of this infrastructure, the transaction costs at the borders, to increase the competitiveness of the countries involved, and promote the economic development of the region.”
The tunnel will be built at more than 4,000 metres above sea level through the Agua Negra pass. At the moment there is a border-crossing point in the pass, but the road is not suitable for trucks and is closed much of the year because of snow.
The existing road climbs to 4,780 metres, but the tunnel will begin at 4,085 metres above sea level on the Argentine side and will descend to 3,620 metres on the Chilean side. For the sake of safety, it will really be two completely separate passages, one running in each direction. Each will be two lanes wide.
When complete, the tunnel will shorten the border crossing by 40 kilometres and three hours. It will also mean the pass can be kept open all year.
The mountains have long hindered east-west movement of goods.
In colonial times, mules carried cargo across the mountains. Even now, Argentina and Chile have 26 border crossings, but most lack infrastructure adequate for truck traffic and are often closed for long stretches because of weather.
The call for proposals for the tunnel drew responses from 10 consortia representing 23 companies from Argentina, Chile, China, France, Spain, Switzerland and the United States.
The envelopes were opened last May. Those proposals have now been evaluated and the next step will be announcing which of the consortia will be invited to submit bids.
The tunnel will be a key part of the Porto Alegre-Coquimbo Central Bi-Oceanic Corridor, between the Brazilian city of Porto Alegre and the Chilean port of Coquimbo, along more than 2,700 kilometres of roads that for the most part are already paved. The corridor crosses several central Argentine provinces.
None of this might have happened had it not been for a push for business organizations along the route.
“The project seemed to be failing in 2014,” says Maximiliano Mauvecin, a businessman based in Cordoba, Argentina. “So, we organized the corridor network with members of the business community not only from Chile and Argentina but also from Brazil, Uruguay and Paraguay. We generated trade missions and business meetings seeking to engage the interests of the governments once again.
“The tunnel will be key to ease our traffic to and from the Pacific Ocean, which will give us access to the Asian market.”
In Chile, there is a lot of anticipation about the arrival of goods destined for Asia. That’s why, earlier this year, there was an announcement of a project to enlarge and modernize the port of Coquimbo to allow it to accommodate more and bigger ships.
For now, though, everyone waits. If everything goes according to plan, tunnel contracts will be awarded within the next seven or eight months and the job will be completed in 2029.
Many would say it’s about time.
Korky Koroluk is an Ottawa-based freelance writer. Send comments to editor@dailycommercialnews.com.
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