Ecuador May Develop $6 Billion Dam Project After Shortages

[phantom power]

Feb. 9 (Bloomberg) -- Ecuador may develop a $6 billion hydroelectric project to create energy supplies for new mines and avert power shortages similar to the ones the South American country experienced in 2009.

The Zamora, one of 17 hydroelectric projects Ecuador aims to build in the next decade to help end dependence on imported power project could include four dams, the first to be completed as soon as 2016, said Galo Borja, minister for coordination of strategic industries. The projects will require financing from state-run companies, he said.

“We are buying expensive energy,” Borja said in an interview in Quito on Feb. 3. “Not doing this will end up being very costly.”

A drought cut Ecuador’s hydroelectric power generation last year, prompting energy rationing that ended in January. The outages probably cost the nation about $1 billion in lost factory output, said Ramiro Crespo, president of Quito-based brokerage Analytica Securities CA Casa de Valores, in a telephone interview.

Zamora would help provide generation for copper and gold production by companies including Vancouver-based Corriente Resources Inc., Borja said. Corriente is developing the Mirador copper deposit in southeastern Ecuador, according to the company’s Web site.

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