Venezuela's IMPSA is renegotiating a key hydroelectric contract with the company, its head has said.

The president of IMPSA, an energy company, said that the firm has made progress in renegotiating a deal to redevelop and renovate two hydroelectric projects. These projects could 'add up to 672 mw in generation capacity if they are completed in the next few months. The contract between IMPSA, formerly an Argentinean state-owned company and now owned by U.S.-based Industrial Acquisitions Fund – and Venezuelan utility Corpoelec was signed more than a ten-year-old ago. However, it has not been implemented due to payment issues and U.S. sanction. The pact was supported by bank loan, including one from?the Andean Development Corporation. Equipment manufactured by IMPSA remained in the company's warehouse at Mendoza, Argentina. IMPSA, under a U.S. licence granted earlier this summer, is now moving forward to sign a contract 'addendum' with Corpoelec for the export and installation of hydraulic turbines, and?mechanical machinery, allowing?it to inaugurate and rehabilitate two separate units in the project Macagua. Both are located in Venezuela’s southern region. "We're looking for a final agreement on the delivery of these unit and payments, etc." Salcedo told an interviewer late on Monday that 90% of the contract's technical and financial elements had been agreed upon. The?contract, since the majority of the equipment that was recently inspected and approved by Venezuelan officials is available, could result in the first capacity expansion for years to Venezuela's electrical grid. The grid currently operates at a deficit causing frequent power outages, as well as rationing. Washington has pushed for a $100 billion plan to rebuild Venezuela's energy grid. However, the state of the grid is a major barrier. It is operating at only a fraction of its capacity. Last week, the country approved a new electricity law through a preliminary vote. Marianna Pararaga, Julia Symmes Cobb, and Andrea Ricci edited the article.

(source: Reuters)