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| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. |
Summary of Project Information (SPI) |
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| Project number | 10024 |
| Project name | Peru Rail |
| Country | Peru |
| Sector | Transportation And Warehousing |
| Department | Infrastructure |
| Company name | Ferrocarril Transandino S.A. |
| Environmental category | B |
| Date SPI disclosed | May 11, 2001 |
| Projected board date | June 15, 2001 |
| Status | Active |
| Previous Events | Invested: November 18, 2002
Signed: June 27, 2002
Approved: May 7, 2002 |
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| Project sponsor and major shareholders of project company |
PeruRail S.A. and Ferrocarril Transandino S.A. are owned by:
- Orient-Express Hotels Ltd. (50%), a publicly listed company on the New York Stock Exchange, and
- Peruval Corp. S.A. (50%), a privately owned Peruvian company mainly engaged in the tourism, infrastructure and real estate sectors in Peru.
Meviasur S.A.C. is owned by Orient-Express Hotels Ltd. (49%), Peruval Corp. S.A. (49%) and nominees (2%). The project company includes PeruRail S.A., Ferrocarril Transandino S.A. and Meviasur S.A. |
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| Total project cost and proposed IFC investment |
| Total project cost is estimated at $47.7 million. The proposed IFC investment would include an A Loan for IFC's own account of up to $7.5 million and a subordinated, income participating C Loan for IFC's own account of up to $1.5 million. |
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| Location of project and description of site |
The headquarter of the project company is located in Arequipa, Peru. The project company operates a 854 km long railroad network in Southern Peru, including:
- the standard gauge Southern line from the ports of Matarani and Mollendo to Juliaca (469 km), from Juliaca to Puno (47 km) and from Juliaca to Cusco (338 km); and
- the narrow gauge (900 mm) Southeastern line from Cusco to Hydro electric, near Machu Pichu (121 km). |
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| Description of company and purpose of project |
Under the 30-year concession contract the Peruvian state railway ENAFER transferred fixed assets and rolling stock of the Southern line and Southeastern line to Ferrocarril Transandino S.A. According to the concession agreement, the shareholders of the Concessionaire are allowed to own one railway operating company. Orient-Express and Peruval formed PeruRail S.A. and took over operations of the network on September 21, 1999. In addition, the shareholders formed Meviasur S.A.C., a company responsible for infrastructure maintenance.
The project comprises the project company’s investments for upgrading and rehabilitation of the railway network, the rehabilitation of rolling stock, the purchase of equipment and radio system and other investments from 2001 to 2004. In addition, the project includes the refinancing of investments in 2000. The project company is expected to improve and maintain the railroad according to Class II American railway standards as specified in the bidding documents and the concession contract. Major parts of track and superstructure will be upgraded, locomotives will be maintained and replaced, and the telecommunication system will be replaced.
The railway sector plays an important economic role in Peru by transporting large amounts of minerals, petroleum derivatives, and other bulk commodities that constitute a substantial part of total exports. This role is even enhanced by helping in the strategic regional development of the ports and in the attraction larger tourism inflows to the country.
IFC has been asked to help financing the project by providing long-term financing on appropriate terms and maturities which are otherwise not available on a project financing basis in Peru. |
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| Environmental and social issues - Category B |
This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects, because a limited number of specific environmental and/or social impacts may result which, can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
To view the environmental documents for this project, click here
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| Location of environmental documents in locally affected community |
- PeruRail office in Arequipa:
PeruRail, Oficina Principal
Avenida Tacna y Arica 200
Arequipa, Peru
- PeruRail office in Cusco:
Estacion Wanchaq, Av. Pachacutec s/n
Cusco, Peru |
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| To contact the project company, please write to: |
| PeruRail, Oficina Principal, Avenida Tacna y Arica 200, Arequipa, Peru. |
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