MOP announces US$900mn reservoir projects to combat drought

Friday, February 11, 2011

Chile's public works ministry (MOP) has announced plans to invest some US$900mn to build six new reservoirs.

The structures will have a total storage capacity of nearly 817Mm3, increasing the country's water storage capacity by 20%, to benefit irrigation, industrial water use and hydroelectric power generation.

The government has said it is carrying out the investment in light of the drought affecting the country. However, the six reservoirs have been in the planning for some time, with a tender almost complete for at least one.

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MOP launched a tender for the Chironta reservoir in December 2009, while the Punilla and Lonquén projects were announced as part of an irrigation plan for region VIII in October of the same year.

Plans for the Purén project have been under discussion since at least 2008 and an EIA for the Puntilla del Viento reservoir was filed in 2006 before being approved this year.

The Chacrillas reservoir, tendered in September 2009, has all but been awarded to Spanish firm OHL, BNamericas reported previously. MOP is waiting for the award to be authorized by the comptroller general's office.

The ministry has said it will invest US$80mn in Chironta, US$244mn in Punilla, US$51mn in Purén, US$59mn in Chacrillas and US$51mn in Lonquén, with these five projects totaling US$485mn.

The investment for the Puntilla was not detailed as the government is carrying out feasibility studies. However, based on the announced investment of US$900mn, the price tag would have to reach US$415mn.

The reservoirs will provide a long-term solution to Chile's water scarcity problems, according to the ministry. Water levels are currently 40% lower than they were this time last year, and the government is looking to postpone the use of hydroelectric generation over the summer months in anticipation of greater need later in the year.