September 6, 2007 / 10:53 PM / 11 years ago

UPDATE 2-Mexico's ICA wins $768 mln La Yesca dam deal

(Updates with construction timetable, ICA reaction, details)

By Catherine Bremer

MEXICO CITY, Sept 6 (Reuters) - Mexico’s Federal Electricity Commission, or CFE, awarded Mexican building company ICA a $768 million contract on Thursday to build one of the world’s tallest dams to help meet Mexico’s growing electricity needs.

ICA (ICA.MX)ICA.N had presented the lowest offer for the La Yesca dam, ahead of a $811.2 million offer by Mexican business magnate Carlos Slim’s infrastructure company IDEAL (IDEALB1.MX).

Italy’s Impregilo IPGI.MI and its consortium partners offered to build the dam for $855.98 million.

ICA, Mexico’s largest construction company and which now has 15 days to sign the contract, described the project as “key to Mexico’s development” and said it had arranged financing for the project, which will be structured by WestLB bank.

“Work will start on September 27 and the finish date is July 11, 2012,” said Jose Franco, deputy director of concessions at the CFE.

One of the biggest projects launched by former President Vicente Fox, La Yesca will be 722 feet (220 meters) high with a basin of 2,390 million cubic meters, the equivalent of Mexico City’s water consumption over two years.

Its 750-megawatt hydroelectric generation capacity will be enough to power 12.5 million lightbulbs, according to the CFE.

La Yesca will be built on the Santiago River, near the border of the western coastal states of Jalisco and Nayarit and construction should generate 10,000 direct jobs.

ICA is partnered by Promotora e Inversora Adisa, La Peninsula Compania Constructora and Constructora de Proyectos Hidroelectricos in the dam concession.

Last November, the CFE rejected bids in a first auction because they were above a ceiling price set by the government or failed to meet technical requirements.

Additional reporting by Robin Emmott in Monterrey

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