EPM asks contractors to relinquish their contract

Company News    Oct 25, 2021 9:38 PM

EPM officially asked Hidroituango’s contractors to reassign their contract for the completion of the project.

Company Manager Jorge Andres Carrillo confirmed this request before the Medellin council, El Espectador reported.

Carrillo reported that he has asked the consortium to seek other assignees to guarantee the continuity of the project.

“What corresponds to us is to prepare for an eventual ruling. For the worst scenario. Without forgetting that this could lead to the suspension of the works,” Carrillo said.

The legal representative of the CCC Ituango Consortium, Santiago García, said that the legal vice-presidency of EPM asked them to give up the contract in a meeting.

“They gave us a message from the management that why did not we cede the contract. We asked EPM to specify the qualities that the assignee should meet,” Garcia said in an interview with Blu Radio.

The consortium asked EPM’s manager to be clear about the consortium’s future in the mega project, via a letter.

The document says that although the contract will expire on December 31st, EPM should have informed them of its intention to extend or not six months ago, so it is automatically renewed.

“Undoubtedly, there will be negative impacts on its development deadlines, additional costs and, surely, in other activities,” the letter says.

Garcia said that the contract can only be assigned if a disqualification is determined and this would occur if the Controller General’s Office ratifies the fiscal responsibility ruling in second instance.

“As long as this does not exist, there is no obligation to assign this contract,” Garcia said.

Garcia explained that the assignment of the contract would be a complicated process, since the consortium has planned several key interventions in the project.

In addition, he believes it is “quite unlikely” that any construction company in the world will take responsibility for such work in the wake of the 2018 contingency.

“It is difficult for us to find who will take it on,” Garcia said.

Garcia said that the consortium has the legal, technical and financial capacity to support EPM and finish the hydroelectric works.

“We received the request, but as long as there is no ruling we will not assign the contract. Actually, we had never contemplated that option,” García added.

In addition, the Controller General suspended, for the third time, the terms of the fiscal responsibility process in the Hidroituango case, Portafolio reported.

The entity explained that this decision was taken upon hearing and deciding the recusal presented by Maria Eugenia Ramos against the officials of the fiscal and sanctioning chamber within this process.

Bottom-Line: The Hidroituango case keeps getting worse.

If EPM wanted to get out of the contractors, it could have done it months ago, notifying the non-renewal of the contract. However, this would have generated a political uproar in the country.

The project’s principal banker, the Interamerican Development Bank says it will pull out if EPM changes contractors in midstream.

Now, the company is asking the contractors to assign the contract without having a ruling from the Controller. Difficult to achieve…

No wonder people are asking what the mayor’s real intentions are with this move.

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