Last checked at 4 Sep 2009 10:50
Rurelec plc
("Rurelec" or "the Company")
Rurelec's Guaracachi to Export Electricity from Bolivia to Brazil
Rurelec PLC (AIM:RUR), the developer, owner and operator of power generation capacity in Latin America, announces that, its 50.001 per cent owned subsidiary, Empresa Guaracachi SA, has now agreed to take administrative control of the San Matias electricity distribution network and to expand power supplies both to the surrounding region in Bolivia and to the immediate border area in Brazil.
The project to add 1.4 MW new capacity in San Matias announced on 24 August was formally inaugurated yesterday. Commenting after the inauguration, Energy Minister Oscar Coca reiterated the importance of improving the reliability of the power supply in the immediate area of San Matias, which is adjacent to Brazil's Mato Groso and is the principal border post between Bolivia and Brazil. Improving power delivery in the area has been a key aim of the Bolivian Government. Guaracachi has already acquired a Deutz gas engine for immediate delivery and this first phase of capacity additions in San Matias is expected to commence operations early in the fourth quarter of 2009.
Following intense discussions with the Brazilian authorities and the Superintendency of Electricity in Bolivia, Guaracachi has now also agreed to take administrative control of the San Matias electricity distribution network and to expand power supplies both to the surrounding region in Bolivia and to the immediate border area in Brazil. This will involve the addition of a second Deutz gas engine as well as new 60 Hz generation capacity based in Bolivia but serving Brazil. A Bolivian banking proposal to fund this enlarged project is due to be approved at a Board meeting of Guaracachi in the coming days. This will increase the overall project to around 5 MW and will be a flagship example of a new public-private partnership with the Government of Bolivia. It will also be Guaracachi's first export of electricity to a neighbouring country.
In a separate development, Guaracachi has now placed with Bolivian institutions the remaining bonds from its AA+ debt-rated twelve year unsecured US dollar bond issue of earlier in the year, taking the total value of bonds placed in 2009 from US $20.2 million to US $24 million. This additional placing, together with a further project loan of US $2.3 million agreed last week with Banco Union, a Bolivian bank, brings the current funding programme for the Santa Cruz combined cycle project to a successful close.
Commenting on the San Matias agreement, Peter Earl, Managing Director of Rurelec, said: "We are delighted to have entered into this agreement with the Bolivian Government. The San Matias plant will improve reliability of power supply in the area, which will in turn facilitate the recent initiatives of the presidents of Bolivia and Brazil to upgrade transport links between the two countries. This is an important step for bi-lateral relations between Bolivia and Brazil and as Rurelec and Guaracachi we are pleased to be playing our part in cross border co-operation."
Enquiries:
Peter Earl, Managing Director, Rurelec plc Tel: +44 (0) 20 7793 5610
Paul Shackleton, Daniel Stewart & Co plc Tel: +44 (0) 20 7776 6550
Ana Ribeiro, Account Director, Blythe Weigh Communications Tel: 44 (0) 20 7138 3206