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MeneameUS energy company AES Corporation (NYSE: AES) will not sell its generation businesses in the Dominican Republic despite the Caribbean country's worsening energy sector crisis, AES president and CEO Paul Hanrahan said during a conference call on Thursday to discuss the group's 2003 results.
"We intend to keep these businesses because we feel there is a reasonable probability of them being sustainable and having some potential equity upside," Hanrahan said.
AES owns the 210MW oil-fired Los Mina plant and the 310MW gas-fired combined-cycle Andres plant in the Dominican Republic. The latter started operations in mid-2003.
However, AES discontinued operations of its Dominican distributor Ede-Este in the fourth quarter of 2003 because the "the distribution business under the current industry structure was not an economically attractive business for us," Hanrahan said.
Ede-Este was involved in legal proceedings against state power company CDEEE for freezing its accounts in a dispute over debt payments.
Hanrahan also admitted that the country's energy sector crisis could go from bad to worse and that there is "some risk" that AES's generation businesses will not remain economically attractive going forward.
The Dominican Republic government has promised to pay power generators US$120mn in the next three months in return for restarting plants shut down since late January.
Generators shut down their plants, causing widespread power cuts, in protest over the government's non-payment of debts owed by distributors.
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