Odebrecht to sell Peru hydroelectric plant to Chinese consortium

Dec 3, 2018
Companies
Posted by Patrick Haddad

A state-owned Chinese consortium has agreed to buy Peru’s Chaglla hydroelectric plant from Brazilian builder Odebrecht SA.

The consortium, led by Three Gorges Corp, has agreed to pay at least $618 million for the hydroelectric plant.

According to Peru’s Justice Minister Vicente Zeballos, Odebrecht will turn over half the sale price agreed upon with the Chinese consortium to cover reparations in a long-running corruption case.

The Chinese consortium also agreed to pay off Odebrecht’s debt to the firms that originally financed the construction of the hydro plant, which would bring the totals investment to $1.39 billion.

Zeballos said Odebrecht would be required to deposit half the $618 million it gets from the sale into a “trust overseen by Peru’s Banco de la Nacion to be used exclusively to pay suppliers and debt.”

The sale of the 456-megawatt hydropower facility, Peru’s third largest, must still be approved by the Economy Ministry and the Energy and Mining Ministry, as well as the state-run power company Electroperu.

The deal is China Three Gorges’ first venture in Peru as the presence of Chinese companies grows in Latin America.

The Chaglla hydro project is a critical supply of power for Peru’s mining industry in the country´s northern Andean mountain region.

 

Source: Reuters

Photo (for illustrative purposes): Open gates of the Itumbiara Dam/ Muriloif/ Wikimedia/ CC BY-SA 4.0

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