Electric Power - Chile - Brazil

MPX to challenge court ruling against 2.1GW Castilla coal project

MPX to challenge court ruling against 2.1GW Castilla coal project

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Brazilian generator MPX intends to fight a decision by an appeals court in the Chilean city of Antofagasta to overrule the environmental approval given to its controversial 2.1GW coal-fired Castilla thermo project planned for northern region III, a spokesman for the company told BNamericas.

On Wednesday the Antofagasta court upheld an appeal launched by environmental and community groups against last February's decision to approve the US$4.4bn thermo plant.

That decision, taken by regional environmental authorities, was referred to as "illegal" by the appeals tribunal.

This is the latest in a series of setbacks MPX has faced over the project, planned to be built 80km south of regional capital Copiapó. The firm first submitted the project's EIS in December 2008 and was given an extension in March 2009 to respond to questions from various agencies regarding environmental concerns over emissions.

Further unfavorable reviews by sanitation authorities were given in 2010, and the green light for the scheme was only achieved following a judgment by the region's Seremi health authority to downgrade its classification for the facility to "troublesome" from "polluting."

Under MPX's plans, the US$4.4bn Castilla thermo will consist of two, 127MW diesel-fired turbines and six, 350MW pulverized coal-fired units. The project also includes construction of a multi-use port, already approved by authorities, which would ship in the coal required to fire the plant.

MPX sources have previously told BNamericas that they hoped to begin construction this year. Full startup of the plant had been set for 2016.

MPX is part of Brazilian billionaire Eike Batista's EBX group.