The High Level Commission from Ecuador will arrive in Moscow in the coming days, with the aim of signing a supplementary loan agreement, in order to fulfil an energy contract to supply electromechanical equipment for the Toachi Pilatón project. The contract is for the construction of two hydroelectric power stations, said the Ecuadorian Coordinating Minister of Strategic Sectors, Rafael Poveda.

The project in question is being implemented in Ecuador by Inter RAO – Export LLC, a branch of Inter RAO JSC, with the assistance of export credits taken out with the Russian Eximbank under sovereign guarantees from Ecuador. An Ecuadorian minister clarified that the addition to the loan agreement will be signed with Eximbank of Russia.

Ecuadorian news portal, El Universo, reported that the need for an additional agreement to be signed was linked with debts that arose from unforeseen expenses and payments in arrears on the Ecuadorian side. Inter RAO – Export appealed to the Ecuadorian government with a letter expressing concern regarding the present situation. The Russian company emphasised that the contract conditions allow the project to be frozen if the problem is not resolved.

Poveda said in response, that there was no serious danger of the project being suspended, however he noted that as with all serious deals, difficulties have arisen during the contract which can be resolved in the negotiations with Inter RAO – Export.

In the documents, which were published by Focus, the Russian company stressed that the commissioning date for the new equipment - currently scheduled for June 2016 - is not definitive. It is not inconceivable that the date could be pushed forward to as late as February 2017.

At the moment Inter RAO – Export is involved in Ecuador, particularly in the expansion of the Termogas Machala thermal power station and in the construction of the Toachi Pilatón hydroelectric power station.