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Over the weekend Fomento de Construcciones y Contratas (FCC) officially inaugurated the new Panama subway, the first in Latin America, in the presence of the President of Panama Ricardo Martinelli.
President Martinelli praised the quality of the new Metro Line 1, which, he noted, “was built in record time”. He spoke in the presence of Esther Alcocer Koplowitz, Chairman of FCC, and of Juan Béjar, the company’s Vice-Chairman and CEO.
Building subways has become something of a specialty for FCC lately. The company is currently already building several other subways as well, has recently commenced construction of three of six new Riyadh subway lines in Saudi Arabia and has just been selected to build the new line in Lima in Peru.
Panama Metro Line 1 was built in just over three years at a cost of about US 2billion dollars (Euros 1.5 billion). The consortium was awarded the contract in 2010, comprising FCC and Brazilian company Odebrecht, and the two groups delivered the project on time and on budget. The same FCC constorium is now also building a 2.2-kilometre extension to the line, plus one additional station.
The new transit system crosses Panama City from north to south. The 10 mile (16 kilometre) route has 14 stations, seven of which are underground, six above ground and one which nestles in a cutting.
The new line is expected to serve a million people, while reducing traffic congestion in Panama’s capital city. The cross-town trip between the two terminal stations will take just twenty three minutes.
Success breeds success, and during the three-hour inauguration, which was attended by thousands of people along the route, the President Martinelli also announced an imminent request for proposals for a second line to be built too.
FCC should have a good chance of being competitive and securing this contract as well, not least because it has a substantial construction infrastructure now already in situ for managing such an additional project.
As there are a limited number of international contractors capable of taking on such a complex project, this line of business, which is growing worldwide as urban areas seek to manage the growing traffic problems that come with economic development, is exactly the kind of potentially higher margin business FCC needs to restore its tattered balance sheet. Provided it is pricing the business correctly therefore, FCC has a chance over the next two or three years of significantly restoring its profitability.