Contractor pick expected

An Italy-based contractor that has built dams in Africa and helped expand the Panama Canal is expected to be tapped today to dig the Southern Nevada Water Authority's third straw into Lake Mead.

Barring a last-minute complication, water authority board members will award the $447 million contract to the Impregilo group and its U.S. subsidiary, S.A. Healy Co.

The contractor will design and build a concrete-lined tunnel 20 feet in diameter and almost 3 miles long underneath the bed of the reservoir.

The new intake will allow the authority to continue drawing water even if Lake Mead shrinks below the level of the two existing straws.

The Las Vegas Valley gets 90 percent of its water from the lake, which continues to shrink in the face of an eight-year drought.

One or both of the existing inlet pipes would be forced to shut down if the lake level falls another 70 vertical feet. The third straw will allow the authority keep drawing water even if the surface drops 120 feet.

It also will give the authority access to the deepest part of the lake, where the coolest, cleanest water is found.

Construction should begin before the end of the year and eventually involve a massive tunnel boring machine that will be manufactured in Germany and shipped to the United States.

The third straw is slated to go on line by early 2013.

Late this summer, the authority plans to begin accepting bids on other projects associated with the third intake. They include a new pumping station inside Lake Mead's Saddle Island and pipelines linking the third intake to the valley's two water treatment plants.

Previously estimated at about $650 million, the price tag for the entire project has ballooned amid rising costs for building materials and worldwide demand for underground construction work.

The most recent cost estimate is $817 million. "I'm still hoping for that or less," said Marc Jensen, director of engineering for the authority.

He added that even the low bid for the intake tunnel came in higher than expected. "We were hoping it would come in closer to $400 million."

The authority will fund the project with a mix of revenue sources. The largest share will come from sales tax revenue and connection charges paid as new homes and businesses hook up to the valley's water system.

Impregilo was one of four contractors to bid last year on the tunneling portion of the project. The authority asked two of those bidders to submit final proposals: Impregilo and a consortium featuring Obayashi Corp., a Japanese firm involved in the Hoover Dam bypass bridge project.

The bid from the Obayashi group topped $588 million, "which was quite high and a shock to us," Jensen said.

Water authority board members will vote today whether to accept the low bid and establish a change-order contingency fund of $40 million.

According to Impregilo's Web site, the firm is among the 35 largest contractors in the world. Its current projects include a dam in Iceland and a railway tunnel between Italy and Switzerland.

S.A. Healy has built subway and sewer tunnels beneath several U.S. cities and played a role in early work on the Third Locks Project, which will expand the Panama Canal.

Contact reporter Henry Brean at hbrean@reviewjournal.com or (702) 383-0350.