The Project, Bioceanico Sovereign Certificate Limited
SUMMARY
The following summarizes certain relevant information included elsewhere in this Offering Memorandum and should be read in conjunction with, and is qualified in its entirety by, the more detailed information appearing elsewhere in this Offering Memorandum. Investing in the Notes involves a significant degree of risk. See "Risk Factors."
The Project
Overview In 2015, the presidents of Chile, Argentina, Paraguay and Brazil entered into an agreement for the construction of a road project known as "Corredor Bioceánico," expected to run from the Chilean deep-water sea ports of Antofagasta and Mejillones-Iquique to the port of Santos, a major Brazilian port, and connect the Atlantic coast to the Pacific coast of South America. Corredor Bioceánico is central to an ongoing plan for regional integration intended to enhance political and commercial relations among Chile, Argentina, Paraguay and Brazil and stimulate economic and social development in these countries by fostering trade throughout the region. Corredor Bioceánico is expected to shorten transit times and decrease logistical costs of goods and services, which should benefit both importers and exporters in these countries. The portions of Corredor Bioceánico in Chile, Argentina and Brazil are mostly already constructed; therefore, most of the remaining construction works are expected to take place in Paraguay.
Paraguay has prioritized the construction of Corredor Bioceanico and has made a commitment to Argentina, Brazil and Chile to finalize it in light of its potential benefits and strategic importance to the region. Paraguay has stated that the Project is strategically important from a geopolitical point of view because it will permit Paraguay direct access by land to both the Pacific and Atlantic Oceans. In addition, Corredor Bioceánico is expected to promote development in the surrounding areas and increase economic activity, particularly in the Chaco region of Paraguay. Through Decree 2,283/2014, the Paraguayan government identified Corredor Bioceánico as a priority infrastructure project and has declared the Project to be fundamental to economic development and regional integration.
The construction of Corredor Bioceánico in Paraguay is expected to take place in two or three phases. The Project is the first phase of the construction, connecting Loma Plata, located in the center-north of Paraguay, with Carmelo Peralta, located near the border with Brazil across from Porto Murtinho, Brazil. The next phase(s) is (are) expected to connect Loma Plata with Pozo Hondo near the border with Argentina. The picture below depicts the entire Corredor Bioceanico.
Description
The Project consists of the design and construction of a 277.2 km highway between Loma Plata and Carmelo Peralta in northern Paraguay. The Consortium is required to perform all construction works in respect of the Project, which will include removal of existing infrastructure and relocation of powerlines, clearing of right of way, leveling and paving works, constructing a drain system, constructing bridges and executing complementary works. Complementary works may include, for example, ditches, wiring and vertical and horizontal signaling.
The Project Contract identifies two major sections (the "Sections"): (a) Section 1: Loma Plata – Cruce Centinela – Cruce Paragro and (b) Section 2: Carmelo Peralta – Cruce Paragro. These Sections are divided each into 10 segments or Milestones, which once completed, must be usable segments of the highway (tramos terminados y utilizables). For more information on the Milestones making up each Section, see "The Project and Financing for the Project—The Project—Description." The picture below depicts the Sections identified in the Project Contract.
In connection with its bid, the Consortium produced a plan for the Project (the "Executive Project") in accordance with the criteria set forth in the tender documents. The Executive Project sets out the Consortium's strategy for the Project's development, including a schedule for the completion and delivery of each Milestone and Section; a strategy for compliance with engineering and technical requirements; and a strategy for the management of environmental and social aspects of the Project. The Consortium's Executive Project was approved by the MOPC on January 15, 2019. Under the Project Contract, the Consortium must develop the Milestones in accordance with the Executive Project and the updated schedule for the completion and delivery of each Milestone and Section reflecting the changes in the Project Contract Amendment.
BIOCEANICO SOVEREIGN CERTIFICATE LIMITED
Prospectus 09 May 2019
U.S.$732,226,000 Series 2019-1 Senior Secured Notes Due 2034
Description:
U.S.$732,226,000 SERIES 2019-1 SENIOR SECURED NOTES DUE 2034
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