At 2:48 p.m. yesterday, he entered the virtual table of the Regional Government of Arequipa (GRA) another time bomb, activated by the eventual cancellation of the project contract Majes II. It is a letter signed by the Inland Energy company that proposes direct treatment. This procedure seeks to resolve the controversy caused “by the breach of the obligations of the GRA that should supply the water of Majes II” for the development of the energy component. Inland Energy belongs to Luz del Sur. In 2018, this company obtained the concession to build the Lluclla hydroelectric plant in the Sierra de Arequipa. The concession is now in the hands of Inland.
Lluclla was going to produce 300 megawatts with the more than 30 cubic meters that will irrigate the Majes and Siguas pampas. This is established in the contract signed with the Government of Arequipa. “Inland strongly rejects the breaches of the GRA and initiates the present direct deal to safeguard their rights”, specifies the letter, also copied to the Ministry of Economy and Finance. They warn that without an irrigation component it is impossible to develop their hydroelectric project. According to the document, they already have environmental and archaeological permits and certifications ready from the Economic Operation Committee of the National Interconnected System.
The company claims to have delivered a letter of guarantee to the Ministry of Energy and Mines, as a guarantee to carry out the work within the established deadlines. They fear that, if the work is not carried out, the bail could be executed. They also affirm that the lack of definition regarding the destination of the work caused the departure of several contractors. “Inland carried out the preparatory activities for the construction of the hydroelectric plant and carries out the financial structuring to begin construction,” it is specified. The text accuses the GRA of having unjustifiably prevented the implementation of the major irrigation infrastructure by not signing addendum 13.
what do they claim
Given the breach, the electricity generator demands a solution to the paralysis of the hydraulic works.
However, if this exit does not prosper, they demand payment of the emerging damage amounting to US$ 9 million. This concept corresponds to restitution of payments and investments that have already been made for Lluclla. In addition, US$ 280 million for lost profits, which the company will no longer receive if the electricity generator is cut short.
Mile Cacic, representative of Inland Energy, recalls clause 19.5 of the contract: If a consensus is not reached in direct treatment, the next path will be international arbitration. administered by the International Center for Dispute Resolution, which is the International Division of the American Arbitration Association of the United States of America.
Lost benefits
The investment in Lluclla amounts to US$ 500 million. The concessionaire reports that without an electrical component, 3,000 direct and indirect jobs are not created. The GRA will also not receive US$ 8.5 million per year, fee for the use of water, US$ 11 million per year of income tax, of which 50% returns to Arequipa in energy canon.
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