FEATURE-Brazil water project, long delayed, gets election year boost

CABROBO, Brazil Mon Feb 10, 2014 1:00am EST

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CABROBO, Brazil Feb 10 (Reuters) - In 2006, then President Luiz Inacio Lula de Silva, a native of Brazil's historically drought-plagued northeast, pushed through an idea that long-suffering residents of the region had been hearing about for more than a century.

At last, he promised, Brazil would channel water to the sun-baked region from the São Francisco, the country's second-longest river. By 2010, he said, water would be pumped over hills and into a 477 kilometer-long network of canals, aqueducts and reservoirs to quench thirsty cities and farms in four states.

Eight years later, and near the end of a first term for Lula's hand-picked successor as president, Dilma Rousseff, the project is only half built. Delayed by bureaucracy and contract problems, the cost of the government's single biggest infrastructure venture has almost doubled to 8.2 billion reais ($3.4 billion).

Plants grow through cracks in the concrete slabs of canals that were laid five years ago. Parts of the early construction are in such disrepair that they will have to be rebuilt by the time any water flows.

Four years past the initial deadline, the project is unlikely to be finished even by the end of a possible second term for Rousseff, whose government is nonetheless accelerating construction as she vies for re-election in October.

The transfer of water from the São Francisco, like many other major infrastructure projects, is the sort of investment that economists have long argued is necessary to modernize Brazil, the world's seventh-largest economy. The country remains crippled by bottlenecks that hinder the efficient flow of goods and services, not to mention the basics needed for development of some of its poorest regions.

But hobbled by bureaucracy, political squabbling, corruption and other obstacles, most infrastructure projects in Brazil take far longer than forecast or never get done at all.

"Lula said the São Francisco project would be the eighth wonder of the world," says Adriano Pires, an infrastructure consultant in Rio de Janeiro. "But it's a fiasco."

CAMPAIGN FODDER

The government says it is moving as fast as possible for a project of such size and complexity, involving myriad contractors and a labor market with a shortage of skilled workers. Construction slowed in 2011 and 2012, for instance, because contracts with builders had to be renegotiated.

"People say it will never be finished, like an Egyptian pyramid that will take ages to build," says José Francisco Teixeira, Brazil's minister of national integration and the official charged with delivering the project.

But by 2015, seven years after work began, Teixeira says water will be flowing to 12 million people in at least parts of the four states meant to benefit: Ceará, Paraíba, Rio Grande do Norte and Pernambuco.

"Seven years is an acceptable time frame for a project this big," Teixeira argues.

Meantime, the government wants something to show for this year. Rousseff, according to people familiar with the project, has urged officials in charge of it to deliver a first section before the October vote.

Northeastern Brazil is suffering its worst drought in half a century and the overdue water project will become campaign fodder for opponents of her ruling Workers' Party.

Home to many of the beneficiaries of the government's most effective social welfare programs and the birthplace of the still-popular Lula, the northeast was once a party stronghold.

But Pernambuco's governor, Eduardo Campos, who has presided over some of the fastest economic growth in the country, is challenging that dominance. Once a Rousseff ally, Campos is now preparing a run for the presidency himself.

In Cabrobó, a Pernambuco town on the banks of the Sao Francisco, the site of the first pumping station is teeming with new workers. Six hundred new hires joined the project in January, expanding the workforce to 8,700.

The goal is to have water flowing by June from Cabrobó to Tucutú, the first reservoir, just 9 km (5.5 miles) away.

A CENTURY OF TALK

The 2,900-km Sao Francisco river flows north from the southeastern state of Minas Gerais and turns sharply seaward when it reaches Pernambuco, leaving the northeast dry.

The idea of transferring water from the river was first proposed in 1847 and discussed ever since. Governments in the 1990s decided to pursue the transfer but could not muster the necessary political support, especially from leaders southward who would be giving up some water.

It was Lula, a legendary negotiator, who convinced them to share a "tiquinho," or tad, of the river water.

Opponents saw it as pork-barrel politics, payback from Lula for campaign financing by big builders and engineering firms. Critics said it would dry up the Sao Francisco, whose flow is already diminished by three hydroelectric dams.

The canals, however, are designed to divert a maximum 1.4 percent of the river's average water volume, lowering intake when the river levels drop.

Engineers and water experts say the project is well conceived and badly needed for growth in a region that is finally emerging from a long history as an economic backwater.

DEAD CATTLE

For locals, the water can't come soon enough.

"There's a pipe connected to my house, but it never has water," says Antonio da Rocha, who drives a cart pulled by bullocks to fetch water three times a week from a pond. The cart plods along the new, unused canal.

Dead cows are a common sight these days on roadsides in the region now in a third consecutive year of drought. Hundreds of thousands of cattle have died of thirst and starvation for lack of water and fodder.

Ulisses Ferraz, who has 15 cows left standing after the drought wiped out 50 head of cattle in the last year, doubts he will ever get water from the project. An existing pipeline feeding the nearby town of Serra Talhadaruns runs by his farm, but he can't tap it.

In a gruesome protest, the 85-year-old farmer has stuck heads of his dead cows on fence posts lining his property.

Meteorologists say droughts in the region will likely intensify with climate change, making water even more scarce.

Water is already rationed for agriculture in some states. If it's still dry, Ceará next year may need to stop irrigating to save water for Fortaleza, a city of 3 million people.

In Paraíba, work has yet to begin on the final section of the canal, including a tunnel through a granite hill in Monteiro.

"Will it ever get here?" asks gas station attendant Genildo da Silva. "I'm 49 and I've heard this story about water from the Sao Francisco all my life."

($1 = 2.4100 reais) (Reporting by Anthony Boadle; Additional reporting by Ueslei Marcelino; Editing by Paulo Prada, Kieran Murray and Leslie Adler)

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