Conelec cancels Electroecuador's Guayaquil concession

Ecuador's energy regulator Conelec has decided to cancel a 30-year contract with Guayaquil province generator Electroecuador after the government approved in July the transfer of the company's assets to a local trust fund, local newspapers reported. The fund will create a new generation company to receive Electroecuador's assets, and that company will have to apply to Conelec for a new concession, Conelec's board said, the papers reported. Electroecuador has 250MW installed thermoelectric capacity, and at the time of the transfer had US$25mn in equity and US$36mn in assets. The company has been in ownership limbo since its former owner, businessman Fernando Aspiazu, was charged in 2000 for irregularities in the administration of his bank Progreso, which declared bankruptcy. Aspiazu supposedly appointed Miguel Lluco to administer Electroecuador and local distributor Emelec through the Progreso Repatriation Trust (PRT) and US-based North Eastern Power and Energy Corporation (Nepec). However, Guayaquil's local government lobbied the national government to have the companies' assets turned over to the province so that Progreso clients could be compensated for the bankruptcy. Guayaquil authorities finally got their way and the state government approved in July the transfer of the companies' assets to a local trust fund controlled by a committee of creditors and government officials. Local company Fodevasa will temporarily administer the trust fund, which will then pass to a government agency such as the National Financial Corporation or the Central Bank.