The provincial government of Santa Cruz announced on Sunday that it has secured a loan of US$136 million from China to restart construction on a hydroelectric dam, a project that has been stalled since December 2023. The total loan is US$150 million and is provided by a consortium of banks led by ICBC and the Bank of China. While $136 million was transferred to Santa Cruz, the remaining $14 million will stay in China to settle accounts with suppliers. The Barrancosa-Jorge Cepernic dam constitutes a component of a broader initiative encompassing two hydroelectric dams. The other is the Néstor Kirchner; however, the current loan exclusively finances the former.
Previous administrations have indicated that the activation of both dams will enhance Argentina’s hydroelectric power output by 15% and has the potential to supply electricity to over 600,000 households. Nevertheless, the project came to a standstill in December 2023, coinciding with President Javier Milei’s inauguration, as a result of insufficient funding. The project commenced in 2015, initiated by Gezhouba, a construction and engineering firm in China, predominantly owned by the Chinese government. The dams are situated 115 kilometers to the west of Puerto Santa Cruz. Prior to the pause in 2023, operations had also been suspended during the administration of President Mauricio Macri, yet activities were reinstated under President Alberto Fernández.
Current estimates indicate that construction on the Barrancosa-Jorge Cepernic dam has surpassed 40% completion, whereas approximately 20% of the work on the Néstor Kirchner dam has been accomplished. Reports indicate that the national Economy Ministry has backed the provincial government in its negotiations to restart construction, even as the national administration leans towards anti-China rhetoric, aligning with the preferences of U.S. President Donald Trump. In an interview, Jaime Álvarez, the Energy and Mining Minister of Santa Cruz, expressed the provincial government’s expectation that the project will reach completion within a three-year timeframe. “This project is long overdue and must be completed as soon as possible,” he stated.
According to sources, activities at the Santa Cruz complex remain suspended, with no official timeline for their resumption; however, some refurbishment tasks have commenced. Last week, the Santa Cruz government convened with representatives from Gezhouba and the Argentine Construction Workers’ Union to finalize the essential agreements required to recommence the project. An official statement indicated that discussions were held regarding the project’s status, alongside advancements made in addressing labor issues.