Announcement of Fifty-Six Million US Dollars Loan to Colombia for the Second Guatape Power Project on January 8, 1973

a INTERNATIONAL_ BANK FOR • RECONSTRUCTION AND DEVELOPMENT () 1 8 1 8 H STREET, N. W .. WASH i NG TON) D. C. 2 0 4 3 3 TEL.EPHONE: E;XEctit1vE 3-6360 Bank Press Release No. 73/1 Subject: $56.0 million }oanto Colombia January 8, 1973 " for the Guat;.:?,fffe II,power project ~ -A, \\\ ~ ~ The World Bank has made a loan·to Empresas Publicas de Me~ellin (EPM) or Colombia, forc:the equivalent of $56.0 million to help fjnancs tlie second\ltage of the Guatape hydroelectric scheme. EPM is an autonomous public utility whicfii _supplies power in ·and around Medellin and is also responsible for prov1dfhg the_c1.ty 1 s water, sewerage and telephone services. Th~,s will be the fourth Bank loan to EPM for i.ts electric power development program.11 The previous loans to EPM -- $12 million in 1:959, $22 million in 1961 and $39 million:} in 1964 -- helped finance hydroelectric plants with an aggregate capacity . rot ,'./ . megawatts, or 72% of EPM's present installed capacity • 531 (i _ The Guatape II project· consists of the construct.ion of the 280-megawatt second stage of the Guatape hydroelectric power statioh •. This involves heightening the Santa Rita dam and duplicating most of the civil and elec~ro·-mechanical features of the first stage; the construction of a 230-kilovolt transmission line to load centers and substa- tiqns; and the expansion of the distribution system in EPM' s service ar~. 'l'hEf\project • is expected to be completed by 1977 • One of the main objectives of the Guatape II project is to help meet the growing demand for electricity by industry, commerce and residential users which are al1~ady being served by Colombia •s central region interconnected power network. This system represents about 80% of the country's power consumption. Within the intercorinected network, the Guatape II project will prima,rily serve· the Medellin area. The expansion or the distribution system of EPM will provide for the connection of new consumers, most of them living in low income areas in or near Medellin who do not now have access to electricity. EPM is taking special measures for the resettlement of the community of ElPenol, which will be flooded when the Santa Rita dam on the Nare river,,is heightened. The population of El Penol (about 3,000) will be relocated in a new town with adequate housing, roads, water, sewerage and electricity services. Severa:,. programs supported by EPM will provide assistance to the resett):ed inhabitants in finding employment in the fields of fishing, agriculture and forestry. The total cost of the Ouatape II project, including resettlement of the inhabitants of El Pehol, has been estimated at the equivalent of $98.2 million. Procurement will be under intemational ,competitive bidding. Colombian manufacturers or electrical equipnent will have a 15% margin ,of preference. The. Bank loan of $56.0 million to Empresas Publicas de Medellin, with the guarantee of the Government of Colombia, will be for a term of 25 years, including five years of grace, at 73>4, interest per annum. . - 0 -  . '(F (' () (j \\ • January 4, 1973 TEQINICAL DATA PROJEcr: Power If \r ··11 \\ 11 COUNTRY: Colombia \\ TOTAL COST:,, $98.2 million i.l ... BANK FINANCING: $56.0 ~illion, 25 years, including 5 years of grace, M int.erest per annm. -· ' · OTHER FINANCING: Internal cash generation, local borrowing and suppliers' credit (for the major electromechanical equipment). IMPLEME?r?ING ORGA.~IZATION: Empresas Publicas de Medellin (EPM), Medellin, • Colombia. Cable Address: EMPRESAS 1 Medellin. Telex 06-649. PBOJEcr DESCRIPTION: Construction of the 280-megawatt second stage of .the Guatape hydroelectric power station; a 230-kilovolt .tran•ission line from Guatape to load centers with <associated sub-stations; and expansion of the distribution system in EPM' a service area. /i PROCUREMENT: Civil works and equipment financed by Bank -- on the basis of international competitive bidding in accordance with the Bank's 11 gui~elines; equipment financed bilaterally -- competitive bidding among suppliers providing credit. Colombian "-suppliers will have a 15% margin of preference. CDNSULTANTS: INTEGRAL I Medellin, Colombia. ESTIMATED COMPLEi!W DATE : 1977. - 0 - I~) •