Colombia multi-utility group EPM has signed a US$300mn loan agreement with Export Development Canada (EDC).
The five-year loan will be disbursed over 12 months. As it is the first financing for the Canadian agency to loan to EPM, the Colombian company is satisfied with the conditions.
“The conditions agreed in this operation underline the trust and solid reputation that EPM has in the sphere of international finance as well as the company’s ability to diversify its sources of funding,” says EPM general manager Jorge Londoño De la Cuesta.
It will serve to finance the company’s US$7.2bn investment plans for the 2017-19 period, which include the Ituango hydropower project, the largest power generation project in the country, as well as others in the energy, gas and water sectors.
The total investment in the Ituango project alone is estimated to be around the US$5.5bn mark. Chilean, Colombian, Brazilian and French companies have been involved in different phases of the construction process. The plant is first expected to become operational in 2018 and be fully completed by 2022. By then, it should account for 13% of Colombia’s total installed power capacity.
Like similar hydropower projects in the region, the Ituango plant too has faced resistance from small-scale miners and cocoa farmers as well as environmental activists concerned about the project’s impact on the local economy and biodiversity.
According to the project’s environmental impact study, a total of 182 families will be subject to relocation, a process already in progress.
A EDC spokesperson tells GTR that the loan is to be used for general corporate purposes, adding that the EDC has conducted a corporate review of EPM, including assessment of their human rights record, environmental record and management practices and has found EPM committed to and in compliance with various international standards.