Cost overruns on 2.4-GW Ituango hydro project in Colombia could exceed US$1 billion

Cost overruns associated with Colombia’s embattled 2.4-GW Hidroituango dam and hydro project could surpass US$1 billion, a leading academic told BNamericas. 

The project was originally budgeted at 11 trillion pesos (US$3.5 billion), but the cost has ballooned amid ongoing construction problems. Oswaldo Ordonez, a geologist and professor at La Universidad Nacional in Medellin, expects additional costs of at least 3 trillion pesos.

“We still don’t know the extent of the damage to the turbine rooms and the collapsed tunnels,” Ordonez said. “There are also a number of lawsuits against [project owner] EPM that could have a large bearing on the overall cost.”

EPM recently announced the completion of the hydroelectric project’s dam wall, which it said “significantly” eased the flooding threat to communities downstream on the Cauca River. Ordonez believes that the milestone reduces engineering and socioenvironmental risks associated with the project “by around 50%.” But he acknowledge uncertainty about the state of the belowground infrastructure

Ordozez also expects EPM to reveal an updated budget for the project by December following the completion of further studies. 

Construction work at Ituango was halted in April last year when the collapse of a water diversion tunnel forced the evacuation of 113,000 people and prompted the regional Antioquia government to declare a state of emergency amid fears of catastrophic flooding. A series of further complications led EPM to postpone the scheduled December 2018 startup by three years in a best-case scenario.

EPM chief executive Jorge Londono told reporters the completion of the dam’s crest will allow work to resume on the powerhouse, adding that two of the plant’s eight turbines are on track to begin operating by the end of 2021. 

Located about 170 km northeast of Medellin, Ituango is Colombia’s largest infrastructure project in investment terms. The 2.4-GW facility is expected to supply over 17% of the country’s electricity when fully operational.

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