Threatened infrastructure, an arbitration claim against Sinohydr and diluted negotiations with China are the main challenges faced by Coca Codo Sinclair

Natural threats to collection facilities and drainage channel; cracks in the distributors… The arbitration claim he filed the Ecuadorian Celec to the construction company Sinohydro and even the shaky possibility of negotiations with PowerChina, the parent company of Sinohydra, to take control of the plant and solve the problems, are some of the challenges arising from the largest hydroelectric plant in Ecuador.

The Coca Codo Sinclair factory, which began to be built in 2008 and was officially opened in 2016, but which until today The government has not officially received, He is currently in a complex situation.

Energy Minister Fernando Santos is straightforward when describing what happened to Coca Coda. A few days ago, he said that the state had made bad investments in the power sector and reported that major newspapers such as the Wall Street Journal and the New York Times published articles on Coca Coda Sinclair, calling it “the worst Chinese company to work outside of China.” , an example of what not to do”. He also reminded that it cost us Ecuadorians 3.2 billion dollars and that “the river will wash away or it will explode through the cracks”.

In accordance with Gonzalo Uquillas, manager of Celec EP, the Coca Codo Sinclair hydroelectric complex has three problems: regressive erosion, sediments along the Coca River that can threaten the discharge, and problems related to the issue of cracks and defects in the canals, the latter being a contractual issue with Sinohydra.

Indeed, in During the last tour of the area of ​​water intake works, the head of Celec explained what kind of physical threats are involved.

First of all, there is the problem of regressive erosion of the Coca River, i.e. which could destroy the collections. To face it, it was Celec EP that calculated the investment of more than 124 million dollars to carry out watershed protection works. The first of them (phase 0) is about to be completed, but a permeable dam must be built immediately or it is also a dam bridge at kilometer 8 from the basin. In addition, it is necessary to build a spillway, in the form of steps, to reduce the force of the current downstream. In the event that these expensive measures do not contain the force of nature, the ultimate solution would be to relocate the water supply at a cost of not less than 500 million dollars.

Second, on the other side of the complex, u water release channel, 61 kilometers downstreamalso there is a danger of destroying the power plant. The problem in this case is that regressive erosion fills the river bed with sediment and the river level rises, and there is a danger that these waters with sediments will go into the discharge channel of the turbine waters. This would certainly cause the power plant to flood. In this sense, says Uquillas, the dredging work had to be done already, and even the relocation of the discharge channel is planned. The possible new construction of the power plant could cost as much as one billion dollars, although this scenario is not on Celec’s radar.

In the same sector where the power plant and turbines are distributors, representing more than 17,000 cracks, which are faults originating in China. These omissions were one of the main arguments for not officially accepting the property. This issue even led Sinohydro to file an arbitration claim against the Chinese construction company. The process is carried out by the International Chamber of Commerce of Chile. According to Uquillas, the Celec and Sinohydra teams have already been formed, as has the arbitrator in the case.

Finally, Minister Fernando Santos indicated that these days a mission of representatives of a Chinese construction company to see the possibility of negotiating the return of Coca Coda to the construction company, that probability seems to have decreased. According to Uquillas, according to the instructions of the President of the Republic Guillermo Lasso and Minister Fernando Santos, possible negotiations were being prepared with PowerChina, the parent company of Sinohydr. The idea would be to transfer operations and maintenance to a Chinese company for fifteen years and for the company to return the money invested by Ecuador. However, the issue was blown when legal problems for alleged bribery in contracting work came to light, involving then-Vice President Lenín Moreno, Conto Patiño and Chinese executives.