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dam-l LS: Work at Ralco Suspended Indefinitely



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CHIP NEWS 

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Date: 9/23/99 

Subject: Work at Ralco Suspended Indefinitely 

Source: El Mercurio

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WORK AT RALCO DAM SUSPENDED INDEFINITELY 

Appeal To Higher Court Could Take Months


--Santiago judge Mario Carroza upheld a Sept. 8 decision halting 

construction at the US$540 million Ralco Dam on the Bio Bio River

 late Tuesday afternoon, ruling that if the work were allowed to proceed 

before courts had a chance to investigate the merits of a case brought 

by two Pehuenche indigenous opponents of the dam, "the environmental

 damage would be irreversible and create numerous difficulties for the 

residents of the area." The rejection of the appeal made by state 

environmental authorities and energy company Endesa Espana (EE) 

has the effect of indefinitely postponing construction of the 570 MW 

hydroelectric project because the appeals court which will review t

he ruling has no prescribed time in which it must act. The two Pehuenche 

opponents of the dam, Berta and Nicolasa Quintreman, filed their lawsuit 

in June 1997, asking the courts to set aside a National Environmental 

Council (Conama) determination that the Ralco Dam project was

 "environmentally viable" and, as a precautionary measure, that all

 work at the dam site be stopped until the case was adjudicated 

on its merits.  It was this second part of the Pehuenche's petition 

that was ruled on favorably by Judge Carroza. The controversial 

dam is the second of a series of dams proposed for construction 

on the Bio Bio River in southern Region VIII to assure Chile's 

energy requirements into the next century. Opponents of the project, 

however, say the arrival of inexpensive natural gas from Argentina 

changes the economic need and viability of additional hydroelectric 

power.  They further argue that local indigenous cultures will be 

destroyed as a result of the dam's construction, as will eco-tourism 

development possibilities.  The Bio Bio is renowned in sporting circles 

as one of the world's top kayak and float-trip rivers. Further complicating

 the issue were statements made by EE executives in early September

 that it was re-evaluating the Ralco Dam's viability.  On Sept. 17,

 however, executives reconfirmed EE's commitment to the project, 

saying there had never been any serious doubt about their desire to 

see it completed.  US$130 million has already been spent on the 

dam's construction. While Ralco's construction has generated temporary 

jobs for 1,500 locals, including 240 Pehuenche indigenous people, 

not all of the 100 indigenous families that would be displaced by the 

dam's reservoir have agreed to property swap proposals made by 

the energy company.  Chile's indigenous peoples law, passed in the 

early 1990s and designed to respect community land arrangements 

unique to the indigenous culture, requires that all Pehuenche community 

members unanimously agree to the sale or swap of commonly held 

property before the land transaction may go forward. EE's efforts 

to secure approval for their project sparked tremendous controversy

 in the National Indigenous Peoples Board (Conadi), ultimately leading

 to the removal of two successive Conadi executive directors who sided

 with the Pehuenche after finding that the company had over-reached in 

its effort to secure the community- wide backing. Que Pasa magazine in 

its Sept. 18 edition said EE had never seriously considered abandoning 

Ralco, suggesting instead that such hints were really a veiled threat aimed 

at Chile's energy regulation authorities, who are currently reviewing the 

tax structure for energy companies for the November 1999 to April 2000 

time period.  By threatening a delay in the project, and thus continuing 

Chile's vulnerability to energy shortfalls, EE hopes to force regulators to 

go lightly with proposed tax hikes on energy.  Que Pasa suggested the 

gambit has been successful, although regulators have yet to officially 

announce the new tariffs. In related news, environmentalists, Pehuenche 

activists and "green bloc" national legislators traveled last week to 

Spain to lobby against the dam's construction and to file a lawsuit 

against EE, alleging that the dam's construction amounts to "genocide"

 for the Pehuenche culture. * Chip News*

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Monti Aguirre

Latin American Campaigns 

International Rivers Network					

1847 Berkeley Way					

Berkeley, CA. 94703 USA

Phone:	 510 . 848.11.55 and 707 . 591 .91.49

Fax:	 510 . 848.10.08

e-mail:  monti @irn.org

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