By Kylie Madry

MEXICO CITY (Reuters). A new Constellation Brands brewery in Veracruz (Mexico) has been announced. It was built after a dispute with water slowed plans for a plant at the Mexican border. This announcement, made by a government official, is expected to attract $2.6 billion.

A previously announced US investment of between $5 billion and $5.5 billion in Mexico, through 2026, includes the plant located in Gulf Coast State.

Constellation Brands will invest initially $1.3 billion into the brewery, Enrique Nachon (Veracruz’s economic-port development minister) said late Monday.

Veracruz believes the company can double this amount by increasing production after the plant has been completed, Nachon said.

“We are pushing for these investments to remain in Veracruz that is, $2.6Billion through 2026,” he said to Reuters. He also stated that regular communication has been maintained between the state and the company.

Construction of the brewery will create up to 2,000 direct jobs and an additional 12,000 indirect. Nachon indicated that once the plant is operational, it will generate up to 775 jobs directly, and 4000 indirectly.

Constellation sent an email saying that it was continuing to work with the Mexican federal and state officials on plans for a new brewery to be built in Veracruz. The government is looking to stimulate investment in this area.

Constellation spent $666million to construct a brewery in Baja California. The referendum by President Andres Manual Lopez Obrador encouraged residents to reject the project because they were concerned about their water consumption.

Nachon didn’t confirm earlier comments made by government officials that the Rio Papaloapan, one of Veracruz’s central rivers would build the plant.

According to him, the underground water source will be used and Constellation is currently looking at 27 parcels of land.

Nachon announced that Constellation Brands will announce the precise location in a joint statement with Lopez Obrador.