Finding a formula for delivering HSR in Brazil 14 Feb 2013
Peter Kenyon, TunnelTalk
After three failed attempts to find a bidder for what it hopes will be the first of many high-speed rail routes, the Brazilian Government is confident it has found a financial formula that will attract an international consortium to build the long awaited 300km/hr 511km-long railway line to link Rio de Janeiro, São Paulo and Campinas. The selected alignment calls for the use of multiple tunnelling methods across both mountainous terrain and under densely populated inner cities. Peter Kenyon investigates for TunnelTalk.
After two years and three aborted attempts to auction the country's first ever high speed rail link, the Brazilian Government has been forced into a strategic rethink.
Now, more than a year after the last failure to find a bidder, a new request for international qualifiers has been issued, and this time the Government is confident the 511km route that would link the major airport cities of Rio de Janeiro, São Paulo and Campinas will actually attract bids rather than expressions of interest.
In all respects the selected route is a challenge. It rises from sea level at Rio de Janeiro, passes through the Sierra das Araras mountains, and reaches an elevation of 700m at the plateau on which São Paulo is built. Nearly 18% or about 90km of the alignment requires tunnels, while a further 21% (107km) comprises bridges and viaducts.
Fig 1. Alignment of the 511km Rio-São Paulo-Campinas route

Fig 1. Alignment of the 511km Rio-São Paulo-Campinas route

It is four years now since Halcrow (now part of CH2M-Hill) and Sinergia produced detailed alignment studies, preliminary estimates of cost and passenger traffic projections. The report, seen by TunnelTalk, makes for sobering reading for potential investors and construction consortia that under the old finance-build-operate model were expected to bear all financing and construction costs. Critics argued, and still do, that the passenger figures were overstated and the construction costs understated.
The BR$28 billion (US$13.7 billion) predicted construction cost in 2008 figures, proved too much for the international financiers and construction consortia that expressed an interest in the last procurement process. Ultimately, none of the groups, from Korea, Japan, Germany, France and China, elected to submit a bid.
This time, Hélio Franca, a Director of the newly-created state company that forms the lynchpin of the new strategy for advancing high speed rail in Brazil, is confident things will be very different.
Both he and his colleague Bernardo Figueiredo in the Enterprise for Planning and Logistics (EPL), are former senior executives of Brazil's National Land Transport Agency (ANTT), the government organisation that has been responsible for developing high speed rail since the idea was first conceived.
Speaking to TunnelTalk from Brasilia, Franca said: "Last time the concession was auctioned on a single design-build-supply-operate model with all the risks of construction centred on the private sector. The cost-risk ratio was deemed [by private investors and construction companies] to be very high, and so what we have done is separate the project into two elements."
The auction, announced at the end of 2012, is for a concession to operate the system, develop the trains and provide the technology. The selected partner will be the consortium that offers the Brazilian Government the best concessionary price to operate the new high speed line (fixed at a minimum BR$70.31 (US$35) per train per km) when balanced against its own projections as to the construction cost.
Route cuts through challenging Sierra das Araras

Route cuts through challenging Sierra das Araras

This marks an important concession by the Government, which now accepts it is for private sector bidders to make a determination of the likely construction costs rather than accept design estimates that put this cost at BR$28 billion (US$14 billion). Assuming that a concessionaire to operate the system is identified, a separate auction for construction of the line will be held later this year, and it will be the Brazilian public through public funding that will foot the bill for this. With a six-year construction phase, completion of Brazil's first high speed rail link is scheduled for 2020.
"Civil works will be the responsibility of the government," said Franca. "We believe that by separating construction and operation, and deciding to finance the full amount of construction from public funds, we have a good system in place."
To make the operation concession more attractive the Brazilian Government raised its proposed stake from 30% to 45% in the Special Purpose Entity (SPE) that will be formed with the successful private consortium of the first auction to operate the so-called Bullet Train. With the first phase estimated at BR$7.6 billion (US$3.8 billion), and with RS$5.4 billion (US$2.7 billion) in BNDES loans already secured, this implies a cash investment of approximately BR$1.25 billion (US$626 million) from the successful consortium (based on a 55-45 equity split of the SPE).
"We [the Government] have no fear of taking on the risks of this project," said EPL President Figueredo. "We are sure that there will be demand for trains." Brazilian taxpayers will get their substantial investment back through a mix of ticket revenue, earned from owning a 45% share of the SPE, plus concessionary fees earned during the 40-year life of the concession.
Under the terms of the latest auction the successful consortium, to be announced following a blind auction on September 19, 2013, will have to guarantee a 99 minute service between São Paulo and Rio; must not include any partners that have suffered a fatal accident on any high speed rail system it has operated in the last five years (down from the 10-year qualification of the last auction); and must make 60% of seats available for a price of less than BR$200.
Table 1. Section distances and tunnel and bridge percentages
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7
Barão de Mauá (RJ) to Galeão Airport (RJ) Galeão Airport (RJ) to Barra Mansa/Volta Redonda (RJ) Barra Mansa/ Volta Redonda (RJ) to São José (SP) São José dos Campos (SP) to Guarulhos Airport (SP) Guarulhos Airport (SP) to Campo de Marte (SP) Campo de Marte (SP) to Viracopos Airport (SP) Viracopos Airport (SP) to Campinas (SP)
Length (km) 15.2 103.1 210.4 61.8 21.8 75.4 23.2
Cost (BR$ million) 1,367 8,253 10,923 3,650 2,313 6,565 1,558
Cost/km (BR$ million) 90.2 80 51.9 59.1 106 87.1 67.2
% tunnel 22% 26% 6% 11% 81% 28% 10%
% bridges 34% 24% 22% 21% 0% 22% 7%
% tunnels & bridges 56% 50% 28% 33% 81% 50% 17%

*Source: Halcrow/Sinergia TAV Capital Cost Final Report (Sept 2009)

Halcrow/Sinergia alignment report

Halcrow/Sinergia alignment report

If the project goes ahead, and Branca says the significant concessions by the Government demonstrate just how important high speed rail is to Brazil, tunnel construction costs alone are estimated at more than BR$10 billion (US$5 billion), more than a third of the total.
In its final report to the Brazilian Government, Halcrow assumes the use of both hard rock and soft ground TBMs, as well as conventional NATM construction methods. In rural areas, approximately 44km of underground excavations will be required along the selected corridor. This is assumed in the report to be a mix of single tube, double-track 16m diameter TBM driven tunnels for a total of 9.5km, and single tube, double-track conventionally excavated tunnels for a total of 34.5km.
In urban areas the assumption is for twin running tunnels excavated by TBMs with a diameter of 7.85m through soft ground conditions for a total length of 46.5km. In coastal Rio de Janeiro in particular, ground conditions are expected to be complex with alignments running under the water table.
Fig 2. The rise through the Sierra das Araras mountains necessitates a 10km tunnel

Fig 2. The rise through the Sierra das Araras mountains necessitates a 10km tunnel

One of the longest tunnels, at between 8.6km and 11km depending on the route selected, will be through the Sierra das Araras mountains. Its length is determined by the need to stay within a 2.5% gradient parameter. A maximum gradient of 3.5% is possible but only for a continuous distance of less than 6km (Fig 2).
The project also calls for between eight and 11 stations, several of them underground.
Table 2. A comparison of world high speed rail networks
Project Opening year Route length (km) Cost/km (US$ million) Bridge/ viaduct % Tunnel %
TGV Sud Est 1983 410 13.7 1 6
TGV Atlantique 1990 320 5.9 1 6
TGV Mediterenee 2001 250 26.1 7 5
CTRL Phase 1 (2003) Phase 2 (2006) 109 75.8 4 25
Shinkansen-Tokaido 1964 515 6.9 33 13
Shinkansen-Sanyo 1975 562 13.3 38 50
Shinkansen-Thoku 1991 501 39 72 23
Shinkansen-Joetsu 1982 275 29 60 39
Shinkansen-Hokuriku 1998 126 45.2 34 50
TGV Korea-Seoul to Pusan Phase 1 (2004) Phase 2 (2010) 412 46 27 46
TGV Taiwan 2005 345 52.6 72 14
TAV (Brazil) 2020 511 30.6 21 18
UK High Speed 2 (proposed) Phase 1 (2026) Phase 2 (2033) 540 59.3 Not known 10
California HSR (proposed - Phase 1 qualified contractors shortlisted) Unknown 1,280 78 Not known 4-6%
According to Branca, the high-risk high-cost venture will ultimately be worth it. He points out that the country's airports are stretched to capacity while urban roads suffer from chronic congestion. "We are talking here about building a rail system into the heart of big cities. Accessing downtown areas and airports is a major civil engineering challenge but we need to create alternatives to air and vehicle transportation. High speed rail is necessary for Brazil and this is just the first step." He also argues that the civil engineering challenges are less onerous than those that faced high speed rail systems in Korea and Japan (Table 2).
The race for Brazil is now on with the USA to be the first country on the American continent to develop dedicated high speed rail. The proposed 1,280km-long high speed rail link to connect Los Angeles with San Francisco in California has seen its initial US$34 billion cost estimate of 2008 rise to nearly US$100 billion currently.
California HSR identifies qualified contractors - TunnelTalk, February 2012
UK High Speed 2 needs 56km of twin tunnels - TunnelTalk, January 2013

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