The Export-Import Bank of China has agreed a US$ 1.7 billion loan for construction of the 1500 MW capacity Coca-Codo-Sinclair hydroelectric plant on the Ecuadorian Amazon River, 75 km east of Ecuador's capital city of Quito.
The project, which includes construction of a dam on the Coca River, a machine house and a 24 km long underground tunnel is expected to cost US$ 2 billion and alongside the loan, 15% will be financed by the Ecuadorian government.
Construction is scheduled to commence in July and will be carried out by Chinese hydroelectric developer Sinohydro.
The Export-Import Bank of China funding had been in doubt earlier this year when Ecuadorian president Rafael Correa halted negotiations in March when the Bank requested state guarantees for the loan. Ecuador's finance minister reported that the terms of the loan had now been adjusted and as a result the agreement had been signed in Beijing, China.
Ecuadorian Economic Policy Coordination Minister, Katiuska King is reported to have said that construction is expected to take approximately five years, and once completed the project will save Ecuador US$ 2.5 million per day as it replaces thermo-electric production and the cost of electricity imported from both Peru and Colombia.
The Coca-Codo-Sinclair hydroelectric plant will supply 45% of Ecuador's electricity needs and cut carbon dioxide emissions by 94.5 million tonnes according to the minister.