Honolulu Seawater Air Conditioning LLC has selected a joint venture of Hawaiian Dredging Construction Co. and James W. Fowler Co. as the contractor for its underground pipe system that will distribute chilled fresh water to buildings in downtown Honolulu.

The project will generate an estimated $200 million in construction spending in Honolulu and create more than 900 construction jobs, the company said in a news release.

The project, which is several years behind schedule, is now on track to break ground in the second half of this year and be operational by 2014. HSWAC officials say it will lower greenhouse gas emissions by nearly 75,000 tons per year, save 260 million gallons of potable water and reduce wastewater discharge by 84 million gallons a year.