Santa Cruz receives US$130 million Chinese loan to reactivate dam project

Santa Cruz provincial government confirmed on Sunday that it had received a US$136 million loan from China in order to resume work on a hydroelectric dam, a project that has been paralyzed since December 2023. The total loan amounts to US$150 million, and comes from a consortium of banks led by ICBC and the Bank of China. While US$136 million was transferred to Santa Cruz, the other US$14 million will remain in China to pay suppliers. The Barrancosa-Jorge Cepernic dam is part of a project that will include two hydroelectric dams. The other is the Nstor Kirchner, although the current loan finances only the former. Past governments have said that once both dams are operational, they will increase Argentinas hydroelectric power generation by 15% and could provide electricity to more than 600,000 homes. However, the project ground to a halt in December 2023, the month President Javier Milei took office, due to a funding shortfall. The project was first started in 2015 by Gezhouba, a Chinese construction and engineering company whose major shareholder is the Chinese government. The dams are located 115 kilometers west of Puerto Santa Cruz. Before the 2023 pause, they had also been halted during President Mauricio Macris administration, but work resumed under President Alberto Fernndez. It is estimated that work on the Barrancosa-Jorge Cepernic dam is more than 40% complete, while around a fifth of the work on the Nstor Kirchner dam has been done. Argentine media reported that the national Economy Ministry supported the provincial government in the negotiations to resume construction, despite the national administration favoring anti-China rhetoric, catering to U.S. President Donald Trump. Santa Cruzs Energy and Mining Minister Jaime lvarez said the provincial government hopes the work will be completed in three years in an interview with Radio LU12 AM680.  This project is long overdue and must be completed as soon as possible, he said. Sources told mbito, the Heralds sister publication, that work on the Santa Cruz complex has not yet resumed and there is no official date for that to happen but a few refurbishment tasks have already begun. Last week, the Santa Cruz government held a meeting with representatives of Gezhouba and the Argentine Construction Workers’ Union (UOCRA), seeking to finalize the necessary agreements to restart the project. They discussed the status of the project and made progress on labor issues, according to an official statement.