Macri govt relaunches 637MW dam talks with Russia

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Tuesday, April 12, 2016

Argentine officials traveled to Russia on a "diplomatic and commercial mission" to discuss the 637MW Chihuido multipurpose dam envisioned for Neuquén province, the provincial government said.

Russian development bank Vnesheconombank pledged to finance Chihuido under the administration of Argentina's previous president, Cristina Fernández de Kirchner.

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The Argentine delegation, which included foreign minister Susana Malcorra and Neuquén governor Omar Gutiérrez, was in Moscow to seek more attractive financing terms for Chihuido before a final deal is signed, Argentine media reported.

Argentina and Russia were also scheduled to review a 2015 framework agreement to develop a 1.2GW nuclear reactor in the South American country.

Argentina's current president, Mauricio Macri, has placed all major bilateral energy deals negotiated by the Kirchner government under review.

In a note published last week arguing for the necessity of large hydropower projects to reduce Argentina's CO2 emissions, local energy consultancy Mosconi stressed the importance of renegotiating the technical and financial terms of Chihuido, as well as the Kirchner and Cepernic dams planned for the Santa Cruz river, in order to ensure the projects' timely, transparent completion and long-term sustainability.

The Kirchner government in late 2014 awarded the construction of Chihuido to a consortium comprising Argentine firms Helport SA, Chediack SAIC, Panedile SAICF, Eleprint SA and Hidroeléctrica Ameghino SA; Spanish company Isolux Ingeniería SA; and Russia's Inter Rao-Export LLC.

At the time, Argentina's planning ministry tagged the investment cost at US$1.84bn.