En Español

Very usefull links


News links




Dow Jones

Oil price



Views and News





Colombia to eliminate Odebrecht's Magdalena River contract



Petroleumworld.com 02 23 2017

Colombia's government has begun termination of an $861 million contract to restore navigability of the Magdalena River that was led by Brazil's Odebrecht, the government said on Wednesday.

The decision was made after Odebrecht, which faces allegations of corruption in Colombia and other Latin American countries, failed to provide funding to develop the project or cede the concession to another company.

"We will start the termination process and directly assume the dredging of the river via (government) public works," said Luis Fernando Andrade, director of Cormagdalena, the government agency in charge of the river tributary.

PowerChina has expressed interest in taking Odebrecht's 87 percent stake in the Navelena consortium, which ran the dredging project. It is conducting technical, legal and financial analysis of the project, the government said.

"If the contract cannot be effectively delivered with PowerChina Limited Colombia, Cormagdalena will guarantee normal navigation on the Magdalena River by signing public works contracts," Andrade said.

Odebrecht received the concession in 2014 and construction was originally slated to begin in June 2016.

The government's decision came after Japan's Sumitomo Mitsui bank pulled $250 million in financing from the project in January as the Odebrecht scandal was erupting.

U.S. prosecutors have accused Odebrecht of paying bribes connected to projects in countries including Brazil, Argentina, Colombia, Mexico and Venezuela between 2002 and 2016. The company has admitted to paying bribes to officials in 12 countries, mostly in Latin America, to help secure lucrative contracts

The Navelena consortium, which also includes Colombia's Valorcon, had until Wednesday to find alternative financing, or the contract would be scrapped.

The dredging would increase cargo transport fivefold on a 256-km (159-mile) section of the river to some 10 million tonnes by 2029 to reduce freight costs and help increase exports by commodities producers and agricultural companies.

Navelena sought to benefit from its investment in the project through toll rates for seven years after completing the modernization of the 908-km (564-mile) waterway.

Reporting by Helen Murphy; Editing by Peter Cooney from Reuters.

We invite all our readers to share with us
their views and comments about this article

Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels









Contact: editor@petroleumworld.com,

Editor & Publisher:P.Ohep F. /Producer - Publisher:P.Ohep F./
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2016, Petroleumworld   / Elio Ohep Fitzgerald- All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.