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Dredging works began on the new port of Veracruz in eastern Mexico over the weekend, the transport ministry announced in a statement.
The new port will be dredged to a depth of 16 meters in order to accommodate large, 'next-generation' vessels, according to the statement.
The cost of the dredging will amount to 1.247bn pesos (US$60.4mn) and will be paid by the HPH-ICAVE consortium as a result of an agreement the group signed with the Veracruz port authority in 2007.
Speaking at the launch of the works, the transport ministry's general port coordinator Guillermo Ruiz de Teresa said that the company agreed to pay for the dredging works and other expenses as a condition to be allowed to relocate the container terminal the group owns at the current port to the new one. The authorities served as advisors for the group during the tender process for the dredging in order to find the most cost-efficient solution, according to the statement.
Ruiz cited the project as an example of how private investment can serve to replace public spending amid periods of public budget constraints.
The material obtained from the dredging will be spread over the 60ha where the five new terminals that are part of the port expansion project will be located.
According to Ruiz, the tenders for the construction of four of the expansion project's new terminals will be launched during the first week of December. He said that the government is expecting the new port to start operations by mid-2018.
The pre-registration notice for the tenders for the construction of a liquids terminal, a multipurpose terminal, a bulk agricultural terminal and a mineral terminal, was published in the country's official gazette in late August.
The Veracruz port expansion project will require 30bn pesos (US$1.61bn), 80% of which will come from private funds. After its completion, cargo handling ability at the port will increase from 22Mt/y to 60Mt/y in a first stage, and to 95Mt/y by 2030 when the second stage is completed.