Chile utilities advance four-plant Aysen complex

Chilean utilities Endesa Chile and Colbun S.A. are in advanced negotiations for the joint development of four hydroelectric projects in the Aysen Region, totaling 2,430 MW.

In notification to securities regulators, Endesa and Colbun confirmed press reports that they are in talks to reach an agreement of understanding, which, if signed, would lead to further negotiations to form a joint venture.

Endesa — Empresa Nacional de Electricidad S.A. — has water rights in Chile’s southern Region XI to develop the 680-MW Baker 1 and 360-MW Baker 2 projects on the Baker River and the 450-MW Pascua 1 and 940-MW Pascua 2 projects on the Pascua River, collectively called the Aysen project.

“In the event that the present negotiations achieve a consensus for signing the agreement of understanding, it is contemplated that the directors of both companies will have to approve its content and authorize its signing,” Endesa Chief Executive Officer Rafael Mateo Alcala said April 12.

In 2005, Endesa and Chilean engineering firm Ingendesa initiated the first draft of a feasibility study of the projects, including land studies and an environmental baseline. Endesa said the studies will be completed in early 2007, with recommendations made regarding implementation of the projects.

Business News Americas reported preliminary work would be carried out through June 2008, when a tendering process would begin. Endesa has said it hopes to begin construction on the first plant in 2009, with completion by the end of 2012. It envisions completion of the other three Aysen plants by the end of 2018.

Mateo told a March shareholders meeting that Endesa would seek a consensus of community groups before investing an estimated US$4 billion in the four plants, which would be built in the pristine forested region of Aysen.

Endesa studies additional hydro sites

As a lesser priority, Endesa also said it is studying development of four other hydropower projects, 400-MW Neltume, 100-MW Los Condores, 134-MW Choshuenco, and 1,280-MW Puelo.

BNamericas quoted an Endesa spokesman who said the utility also is studying the 685-MW Steffen-Porton hydro project. The official said those projects are in preliminary evaluation and no environmental studies have been submitted.

For information, contact Empresa Nacional de Electricidad S.A., Santa Rosa No. 76, Santiago, Chile; (56) 2-6309000; Fax: (56) 2-6353938; E-mail: comunicacion@endesa.cl; Internet: www.endesa.cl.

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