Identifier
Created
Classification
Origin
07PANAMA1812
2007-11-27 16:00:00
UNCLASSIFIED
Embassy Panama
Cable title:
SECOND PANAMA CANAL EXCAVATION CONTRACT GOES TO
how-toVZCZCXRO6910 RR RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHTM DE RUEHZP #1812/01 3311600 ZNR UUUUU ZZH R 271600Z NOV 07 FM AMEMBASSY PANAMA TO RUEHC/SECSTATE WASHDC 1475 INFO RUEHZI/WHA IM POSTS COLLECTIVE RUEHME/AMEMBASSY MEXICO 3683 RHMFISS/COMDT COGARD WASHINGTON DC RUCPDOC/DEPT OF COMMERCE WASHDC RULSDMK/DEPT OF TRANSPORTATION WASHDC
UNCLAS SECTION 01 OF 02 PANAMA 001812
SIPDIS
SIPDIS
FOR STATE WHA/CEN - TELLO
E.O. 12958: N/A
TAGS: ECON ETRD EWWT FCSC PM
SUBJECT: SECOND PANAMA CANAL EXCAVATION CONTRACT GOES TO
CARLOS SLIM'S FIRM
REF: A. PANAMA 1236
B. PANAMA 1719
UNCLAS SECTION 01 OF 02 PANAMA 001812
SIPDIS
SIPDIS
FOR STATE WHA/CEN - TELLO
E.O. 12958: N/A
TAGS: ECON ETRD EWWT FCSC PM
SUBJECT: SECOND PANAMA CANAL EXCAVATION CONTRACT GOES TO
CARLOS SLIM'S FIRM
REF: A. PANAMA 1236
B. PANAMA 1719
1. (U) SUMMARY. Consorcio Cilsa Minera Maria, a unit of
Mexican billionaire Carlos Slim's Grupo Carsa, was the low
bidder on the second dry excavation contract for the new
Pacific lock access channels portion of the Panama Canal
expansion project. It what has become a trend, the sole U.S.
bidder was the highest bidder. Slim has increased his
investments and activities in Panama. END SUMMARY.
-------------- --------------
Slim Offers Low Bid on Second Excavation Contract
-------------- --------------
2. (U) On November 15, 2007, the Panama Canal Authority
(ACP) received eight proposals for the second of the five dry
excavation contracts for the new Pacific lock access channel.
The Panamanian-Mexican consortium, Consorcio Cilsa Minera
Maria (CMM),was the low bidder at $25,489,200. CMM is a
unit of Carlos Slim's Grupo Carsa. While the proposal still
must be reviewed by the ACP to assure it meets all ACP
criteria, CMM is widely expected to be awarded the contract.
3. (U) Eight firms from five countries participated in the
bidding. As with the bids for the first excavation contract
in July 6, 2007 (reftel A),only one U.S. company,
International Underground Corp. (IUC),participated. And
again the U.S. bidder had the highest bid. IUC's $61.7
million bid was almost $16 million higher than the second
highest bid and almost 250% over the CMM bid. The winner of
the first dry excavation contract, Panama's Constructora
Urbana, was third with a bid $5.42 million higher than CMM.
--------------
A Review of the Bidding
--------------
4. (U) The submitted bids were as follows: CMM -
$25,489,200; Consorcio Masering Cromas (Colombia)-
$30,564,475; Constructora Urbana (Panama) - $30,913,000;
Consorcio Conalvias Retraneq (Panama-colombia) - $37,492,853;
Consorcio M&S MECO Santa Fe (Panama-Costa Rica) -
$40,986,400; Consorcio Condor Proimpetrol (Colombia) -
$42,455,577; Consorcio ICA Panama-ICA CV (Panama-Mexico); and
IUC (U.S.) - $61,745,339.
--------------
Scope of Contract Work
--------------
5. (U) The second dry excavation contract involves the
removal of 7.5 million cubic meters of land along a 2.4
kilometer stretch just north of where the new Pacific locks
will be built. The contract also requires the construction
of a new road, a crossing over the nearby Cocoli River, and
the removal and/or relocation of electrical,
telecommunications, water and sanitation lines. CMM will
have 670 days from the date of official award of the contract
to complete the work. The estimated completion date is
October 2009.
--------------
Next Contract to Be Awarded
--------------
6. (U) The next contract to be awarded is for the dredging of
the existing Pacific entrance navigational channels. Bids
are due by January 28, 2008. The contract calls for the
widening to at least 218 meters and deepening to at least
15.5 meters of such navigational channels in order to permit
the use of Post-Panamax ships
--------------
Slim Widens Interest in Panama
--------------
7. (U) Slim has steadily increased his investments in
Panama. His company, Ideal, through its Panamanian
subsidiary Cicsac, has the concession to build and operate a
hydroelectric plant in Panama's western province of Chiriqui.
Cicsac paid over $31 million for the concession. In October
2007, Slim's department store, Sanborns, opened its first
outlet in Panama. Slim has traveled to Panama at least five
time since Martin Torrijos became president. Slim lent his
personal plane to Torrijos to attend Pope John Paul's
PANAMA 00001812 002 OF 002
funeral. There are persistent rumors that Slim has been
buying property on Panama's Caribbean coast for tourist
development. Slim has also expressed interest in
participating in future Panama Canal expansion contracts,
including the approximately $3 billion design/build contract.
Slim is a key benefactor of "Wings for Children" foundation
headquartered in Panama and spearheaded by Colombian singer
Shakira.
--------------
Comment
--------------
8. (U) Again the U.S. bidder was by far the highest bidder.
With only the design/build and three excavation contracts
remaining, it is difficult to see U.S. companies being cost
competitive and winning any of the remaining contracts
(reftel B).
EATON
SIPDIS
SIPDIS
FOR STATE WHA/CEN - TELLO
E.O. 12958: N/A
TAGS: ECON ETRD EWWT FCSC PM
SUBJECT: SECOND PANAMA CANAL EXCAVATION CONTRACT GOES TO
CARLOS SLIM'S FIRM
REF: A. PANAMA 1236
B. PANAMA 1719
1. (U) SUMMARY. Consorcio Cilsa Minera Maria, a unit of
Mexican billionaire Carlos Slim's Grupo Carsa, was the low
bidder on the second dry excavation contract for the new
Pacific lock access channels portion of the Panama Canal
expansion project. It what has become a trend, the sole U.S.
bidder was the highest bidder. Slim has increased his
investments and activities in Panama. END SUMMARY.
-------------- --------------
Slim Offers Low Bid on Second Excavation Contract
-------------- --------------
2. (U) On November 15, 2007, the Panama Canal Authority
(ACP) received eight proposals for the second of the five dry
excavation contracts for the new Pacific lock access channel.
The Panamanian-Mexican consortium, Consorcio Cilsa Minera
Maria (CMM),was the low bidder at $25,489,200. CMM is a
unit of Carlos Slim's Grupo Carsa. While the proposal still
must be reviewed by the ACP to assure it meets all ACP
criteria, CMM is widely expected to be awarded the contract.
3. (U) Eight firms from five countries participated in the
bidding. As with the bids for the first excavation contract
in July 6, 2007 (reftel A),only one U.S. company,
International Underground Corp. (IUC),participated. And
again the U.S. bidder had the highest bid. IUC's $61.7
million bid was almost $16 million higher than the second
highest bid and almost 250% over the CMM bid. The winner of
the first dry excavation contract, Panama's Constructora
Urbana, was third with a bid $5.42 million higher than CMM.
--------------
A Review of the Bidding
--------------
4. (U) The submitted bids were as follows: CMM -
$25,489,200; Consorcio Masering Cromas (Colombia)-
$30,564,475; Constructora Urbana (Panama) - $30,913,000;
Consorcio Conalvias Retraneq (Panama-colombia) - $37,492,853;
Consorcio M&S MECO Santa Fe (Panama-Costa Rica) -
$40,986,400; Consorcio Condor Proimpetrol (Colombia) -
$42,455,577; Consorcio ICA Panama-ICA CV (Panama-Mexico); and
IUC (U.S.) - $61,745,339.
--------------
Scope of Contract Work
--------------
5. (U) The second dry excavation contract involves the
removal of 7.5 million cubic meters of land along a 2.4
kilometer stretch just north of where the new Pacific locks
will be built. The contract also requires the construction
of a new road, a crossing over the nearby Cocoli River, and
the removal and/or relocation of electrical,
telecommunications, water and sanitation lines. CMM will
have 670 days from the date of official award of the contract
to complete the work. The estimated completion date is
October 2009.
--------------
Next Contract to Be Awarded
--------------
6. (U) The next contract to be awarded is for the dredging of
the existing Pacific entrance navigational channels. Bids
are due by January 28, 2008. The contract calls for the
widening to at least 218 meters and deepening to at least
15.5 meters of such navigational channels in order to permit
the use of Post-Panamax ships
--------------
Slim Widens Interest in Panama
--------------
7. (U) Slim has steadily increased his investments in
Panama. His company, Ideal, through its Panamanian
subsidiary Cicsac, has the concession to build and operate a
hydroelectric plant in Panama's western province of Chiriqui.
Cicsac paid over $31 million for the concession. In October
2007, Slim's department store, Sanborns, opened its first
outlet in Panama. Slim has traveled to Panama at least five
time since Martin Torrijos became president. Slim lent his
personal plane to Torrijos to attend Pope John Paul's
PANAMA 00001812 002 OF 002
funeral. There are persistent rumors that Slim has been
buying property on Panama's Caribbean coast for tourist
development. Slim has also expressed interest in
participating in future Panama Canal expansion contracts,
including the approximately $3 billion design/build contract.
Slim is a key benefactor of "Wings for Children" foundation
headquartered in Panama and spearheaded by Colombian singer
Shakira.
--------------
Comment
--------------
8. (U) Again the U.S. bidder was by far the highest bidder.
With only the design/build and three excavation contracts
remaining, it is difficult to see U.S. companies being cost
competitive and winning any of the remaining contracts
(reftel B).
EATON