Government will call for bids for electric power highway routing and national interest strips will be defined
25-Jul-2012 Diario Financiero – News
Land expropriation to be avoided
Government will call for bids for electric power highway routing and national interest strips will be defined
In Mining Council meeting Energy and Mining Ministers dealt with sector rising concern for energy costs
That mining industry is one of the main industries to be affected by high prices of energies is a real datum. And it was precisely in the meeting the Energy and Mining Ministers held with Mining Council where first definitions of electric highway project to be submitted by Government in August were exposed.
Thus, Jorge Bunster, Minister of Energy, stated in a behind-locked-door discussion that the highway course will be decided by calling for bids for a study where strips will be defined.
Then those strips will be declared as “national interest strip” which means legal concessions will be statutorily granted for which payment may be negotiation at a later time.
Regarding the political consent on the fact that electric supply issue is a problem that involves the whole country, the Ministers asserted that even when there are no doubts about it, there is no certainty as to when the project could pass the Congress.
Losing Competitiveness
The loss of competitiveness of the sector as a result from high energy costs was a topic also dealt with during the meeting. Some executives set out that at current levels many mining investments that had been already budgeted are being put on stand-still condition or they will not be carried out at all. Some attendants reported that it was not a menace but just a fact verification. When being asked about this matter, Minister Bunster said that he does not believe a competitiveness issue exists but that “we are going through a time when energy costs are higher, however we are sure that after all the measures that are being taken and because of the projects that will continue coming, prices will be finally lowering”.
Hernán de Solminihac, Minister of Mining, highlighted the importance of projects that are scheduled in the agenda, not only in energy but also in mining industry, are developed in the terms they were designed “because we want to grow as a country and become developed, consequently, these projects are fundamental to accomplish that purpose”. Besides he added that energy is one of main challenges this industry sector is to face nowadays.
On the other side, application of Convention 169 also was an important topic in the meeting. Thus the representatives of mining industry expressed their concern about the way the courts construe the Convention scope when no regulation exists for its application.
After the meeting was concluded the Executive President of Mining Council, Joaquín Villarino, commented that “lack of proper regulation regarding Convention 169 is a hurdle for projects development (…). The problem is that it is not regulated at all and courts have been rather erratic in their construal of the Convention.”
As to judicialization of power generation projects, the executive asserted that this is “something to be worried about because it means environmental institutional rules are not properly working. It does not make much sense that everything is going to the court after it has all gone through a four-year evaluation. From that standing it is obviously a concern”.
