UPDATE – Bolivia to launch work on 120-MW Misicuni despite setbacks

Bolivia’s water minister announced the government will initiate construction of the 120-MW Misicuni multipurpose hydroelectric project in December regardless of whether it receives Italian financing.

In September, project developer Empresa Misicuni postponed a deadline for bids from Italian and Bolivian firms to build the 120-meter-tall dam due to lack of Italian companies interested in the work. (HNN 11/18/08) Bolivia secured US$31 million in funding from the Italian government in May 2007, on the condition that an Italian firm would form part of the development consortium.

Ministerio del Agua Rene Orellana said his agency is working on technical, financial, and legal mechanisms to allow the project to proceed in Bolivia’s Cochambamba Valley, state-run Agencia Boliviana de Informacion reported November 23.

�If, by the end of November, the problems of the present solicitation are not resolved with the resultant hiring of an executing company, the national government will assume decisions that will guarantee the execution of Misicuni Dam from December,� Orellana said.

Orellana said Bolivian President Evo Morales declared Misicuni to be a priority that is important to the development of Cochambamba Prefecture.

The minister said alternative resources are available to begin construction of the project. He said Empresa Misicuni has US$14 million, plus US$16 million from Cochambamba Prefecture’s 2009 budget. Additionally, he said US$7 million is coming from multinational lender Corporacion Andina de Fomento, and US$6.5 million from the Bolivian Treasury, for a total of US$43.5 million available to begin work.

Misicuni includes a 120-meter-tall, 512-meter-long dam; a 150 million-cubic-meter reservoir; 444-meter diversion tunnel; and a water treatment plant. When complete, the project is to provide water to the Cochabamba metropolitan area and is to irrigate more than 15,000 acres, in addition to the potential to generate hydroelectric power estimated at 120 MW.

Bolivia utility Ende and South Korea’s Korea Electric Power Corp. have signed an agreement to build a 120-MW hydro plant as part of Misicuni.

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